According to MarketWatch, 40% of Americans do not have life insurance, and the majority of those who don’t have life insurance choose not to because they think it’s too expensive. TermLife2Go has found that people assume that life insurance is 3x more expensive than it really is.
TermLife2Go created a guide to understanding the costs of life insurance.
Putting costs into perspective:
- A 20-year-old man could get a $250,000, 10-year term life insurance policy for the price of his monthly Spotify subscription (about $10/month).
- A 40-year-old woman could get $1 million of 20-year term life coverage for the cost of 12 Grande Starbucks lattes (about $45/month).
- A 30-year-old woman could get $250,000 of permanent coverage from a universal life policy for the price of six cocktails (about $75/month).
- A 40-year-old woman could get $1 million of 20-year term life coverage for the cost of 12 Grande Starbucks lattes (about $45/month).
- A 30-year-old woman could get $250,000 of permanent coverage from a universal life policy for the price of six cocktails (about $75/month).
Experts quotes for finding the right life insurance policy:
“When choosing a payout, it’s best to start with what you want to accomplish. Think about what needs your family will have if you were to pass away unexpectedly. A 30-year-old with a newborn will have different needs than a 60-year-old who is thinking of retiring soon.”
Mathew Barr, Loyal Christian Benefit Association
“Insurance carriers have started defining who they are better able to work with. What used to be an instant declination of insurance coverage for cancer survivors is no longer the case. And some carriers now rate via unisex categories rather than a distinct male and female categorization.”
Henry Wong, Friendly 401k
"There are two main reasons to get life insurance as soon as you can. First, rates are based mostly on age. The younger you are, the lower your monthly premium is likely to be. Second, life is unpredictable. Worrying about how loved ones will cover the mortgage or put food on the table without you might keep you up at night. The sooner you have coverage, the sooner you can relax knowing your family will be taken care of."
Kathryn Casna, TermLife2Go
I had a chance to interview life insurance expert Alex Enabnit to learn more.
- Why do so many people go without life insurance?
- Why is it important for parents to have enough life insurance?
- How can people wade through the options to find the best fit for their situation?
Life insurance is a tricky subject. It forces someone to think of their own mortality. Life insurance requires someone to pay for a product that is not only intangible but the benefits of which will likely be delayed. The person who buys life insurance might never be able to reap its rewards. All these reasons combined are the likely culprits behind why so many people don’t buy life insurance.
But of course, life insurance is vital for many people. Whether we want to acknowledge it or not, many of us would put loved ones in a bad financial position if we passed away unexpectedly. Purchasing life insurance requires us to think past ourselves. It requires imagining the uncomfortable possibility of a future where we may not be around to provide for our family.
Of course, the need for life insurance rises even more dramatically once someone becomes a parent. Every parent wants to take the best possible care of their child, working hard to meet their needs. But if a parent dies, would the surviving parent be able to care for the kids and pay the mortgage? Would they be able to afford daycare while they work to provide? Would they have enough to meet their current needs, let alone save for the future needs the children may have?
These questions are just a few of the considerations that drive parents’ life insurance investigation. But once parents decide they need life insurance—which they do—the next question is, how much? The general rule of thumb is 10–12 times your annual income, but your needs will vary depending on your circumstances. A stay-at-home parent, for example, doesn’t technically have an income, but their financial impact is huge. Imagine the daycare costs, the nannying, the meal preparation costs that would be lost in their absence. There are a lot of things to consider to ensure you purchase enough coverage for your family.
Once you go down the rabbit hole of life insurance, you soon realize there are a few options for coverage. Term or whole? Permanent coverage or a laddering strategy? How much coverage do I really need? For every life insurance question, we have answers. No matter where you are in your life insurance journey, TermLife2Go can help with guides, brand reviews, and articles that will guide you to the best life insurance decision for your unique situation.
Check out the full report here: https://termlife2go.com/how-
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