Life insurance is something your parents and grandparents worry about, right?
You are young, just getting started in life, and cannot afford yet another monthly payment for something you do not even see, hold, or use.
The general rule that applies to life insurance, as far as how expensive they are, is that the older you are the more expensive your premium – the amount you pay for coverage – will be. It is simple to figure out that a life insurance company who will be covering an older person will be aware that they are more likely to pass away whilst being covered by their plan. Buying a life insurance policy before you’re 30 can save you thousands in the end.
As you get older, you may experience health issues that would make it difficult to qualify for a cheap life insurance policy. Before you’re 30, you are less likely to have pre-existing medical conditions or an unhealthy lifestyle. This is the best age to be able to buy a cheap life insurance policy, but also to qualify for one quickly and easily.
One in three women married before they are 30
One in three women and one in four men are married before they are 30 years old, according to the latest statistics. If your intended spouse would suffer under debt without some type of assistance, a life insurance policy is an important thing to have in place when considering marriage. Along with good health and young age, buying life insurance before getting married is a smart move to ensure that your partner will be able to maintain their lifestyle.
The statistics also tell us that by the time most women are 28 they have had their first child, and dads are not far behind. Most parents should have life insurance in place for the benefit of their children in case something tragic would happen. Even if you pass away debt-free, your children may not be old enough to be fully independent.
Debts and Final Expenses
If you pass away and leave debt in your name, your spouse, children, or other family members will be responsible for paying it back. Combined with the grief of losing someone they love, having a heavy financial burden to shoulder is even more painful. The proceeds from a life insurance policy can be used to pay off any debts you leave behind.
Funerals are expensive, and according to the insurance company Royal London, the average funeral cost to your loved ones would be £3,757. This expense can be stressful on loved ones, so even a small policy is an investment in making sure your family does not have to worry about costs on top of everything else.
Employer Policies Are Not Enough
Many employers offer a “death-in-service” benefit, as company life insurance, which is equal to approximately four times your yearly salary. Whilst this amount will help your family to bear the financial burden of final expenses, it will not go very far if you have student loans, a mortgage, or other debt. Taking out a separate policy for extra coverage is a wise move, especially if you have debts or other considerations.
Most people who buy life insurance before 30 years of age are first-time buyers who may not understand the details. It really is not difficult, as life insurance can be put into two classes:
- Level Term – payout is the same no matter when
- Decreasing Term – payout decreases over time
Life insurance that is classified as Level Term will pay out a set amount no matter when you pass away. The typical length of a level term plan is from 10 to 25 years but can go as high as 50 years. Decreasing Term insurance is more popular, especially for people under 30. The policy is usually to cover some type of debt such as a mortgage. The payout decreases over time as the debt instrument gets smaller and needs less cover.
There are different types of life insurance policies, including the right one for you. Even if you’re under 30, there are compelling reasons to take out a life insurance policy now before you are married with children. Your young age and good health will qualify you for cheaper rates on policies that will cover your future spouse and children from the debt you leave behind.