Just like nearly everything else in your life, your insurance needs also change as you get older. This is especially true when it comes to life insurance. When you’re still in your 20s, you might still be paying for loans you took out back in college or for a car you purchased. By the time you hit 30s, you might also have secured a mortgage and starting to build a family. At 40s, you might help out your kids pay for college.
In short, since your financial responsibilities change as time passes by, you have to adjust your life insurance accordingly.
Like with other types of insurance products, such as car and health policies, age has a huge bearing on life cover. Whether you purchase a policy from a Connecticut or Wyoming insurer, your age is a critical component to carefully consider once you decide to purchase life cover for yourself or when you already have a family to think about. When you purchase a policy in your younger years, you’ll have lower premiums. Begin insurance at a much later date, and you can expect to pay double or even more.
So to help you make the right decision, take a look at this timeline that shows one’s ever-changing insurance needs.
Below 18 years old
Life insurance provides you with a way to protect the quality of life you and your family has. When your child sets off for college, your first priority may be helping pay for the costs associated with higher education. And while you may not want to dwell on it, it’s better to have a plan set in place in the event that something unfortunate happens.
As a parent and a primary breadwinner, your life insurance policy will help ensure your children can remain in school even when you’re gone. Or at the very least, you should get coverage for your child to help cover the costs of burial services if an accident takes place.
Both term and whole life coverage will help pay for burial expenses, regardless of who own the policy. And if your plan comes with the investment component called cash value, your loved ones can use the proceeds to remain financially stable, until such time they’ve recovered from your loss.
Even if you’re still just in your 20s, you should already think about your future, especially if you plan to have a family. With life cover, you can protect the people you care about from potentially devastating financial loss. At the minimum, the surviving members of your household can use your policy’s death benefit not just to cover burial expenses, but also to pay off the mortgage, so they can continue living in the home you shared with them.
By this time, you possibly already have a child who goes to college. You might also be helping pay for your kid’s school expenses. Passing away can put a drastic toll in the lives of your loved ones, and not being prepared can even lead to your college kid having to leave school. And since you most likely still have remaining payments to make towards your home loan, you should make certain your life insurance policy’s payout is enough to help your family cover these costs.
This is also a good time to consider whole life coverage for yourself, so that you can have an extra source of income for all these considerable expenditures.
Older adults, Retirees
You may no longer be the primary household earner, but it doesn’t mean you can no longer provide for your family, especially after you’re gone. If you haven’t purchased life cover yet, you should do so as soon as you can. Keep in mind though, that it is during this time frame when premiums are at their highest, but the financial benefit of being insured nonetheless outweighs the cost. At the very least, a policy can eliminate the burden of burial expenses your loved ones would otherwise have to face if you don’t prepare for a time like this.
Leave your loved ones protected and financially secure by making the necessary adjustments to your life insurance policy based on your changing needs. To learn how to find your lost life insurance documents, click here.
Insurance Information Institute: http://www.iii.org/insurance-topics/life-stages
National Association of Insurance Commissioners: http://www.naic.org/Releases/2016_docs/consumer_alert_life_insurance_roadmap.htm