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Evaluating Your Life Insurance Needs as You Age

By December 27, 2018November 22nd, 2019No Comments

Checking your coverage needs for your life insurance periodically is important since your debt fluctuates. Thus, the amount of coverage you need fluctuates as well. Having life insurance, no matter the age is sensible, but you can benefit by starting a plan earlier rather than later.

Reasons why you need life insurance coverage in your 20s.

  1. If you recently obtained a college degree, your debt could be covered.
  2. The optimal age to purchase life insurance is under age 35.
  3. It can help you save for retirement. Young people are often focused on their current finances and are not thinking about saving money for their future spending, such as retirement. By finding the right policy for you, it can accrue a cash value, which can help you organize your finances, so there is money to draw from in the future.

Additional Notes: In your 20s, when purchasing life insurance, it is important to evaluate your life insurance needs with big life changes like getting married, having kids, etc.

Reasons why getting life insurance in your 30s is a good idea.

  1. If you are a newlywed, you may need to get life insurance to cover expenses and income if something were to happen to you. As newlyweds, you and your spouse’s income combined may be able to afford to pay for your mortgage and bills, but what if an unexpected death left you with only one income? Without life insurance, it would be up to the income of one person to afford the cost of living. Money is the last thing you want to think about if your spouse passes away, and a life insurance plan could assist you financially.
  2. As a parent, life insurance is an important option to discuss. To be prepared, it is best to have a life insurance plan set up so your children could financially support themselves if both parents were to pass away at the same time.
  3. Be sure to look at other policies other than what your employer-provided you; those policies typically only offer less than what you need, especially if you have financial dependents. To be safe, buying a policy that is 10 times your annual salary is the suggested amount by most experts.

Additional Notes: Even if you have life insurance, during their 30s is often when people have big salary bumps – a vital time to re-evaluate life insurance needs.

Reasons why you need life insurance in your 40s.

  1. In your 40s, it is a good time to adjust your life insurance policy if you are uninsured or underinsured. Starting the conversation about life insurance is important in order to assess your needs. Whether you need to add coverage because your employer’s policy isn’t enough coverage anymore, or if you need to start a term life insurance policy, now is the time to find what is best for you.
  2. Life insurance can cover day-to-day activities like childcare, sports, and college. The cash value allotted from whole life, variable life, or universal life insurance policies could help you pay for large-scale costs.
  3. If you have a paying job and your spouse is a stay-at-home parent, your income is the sole provider for your family. In order to protect a stay-at-home parent in the case of a spouse’s death, a life insurance policy is needed to make up for the lost income.

Additional Notes: If life insurance policies in your 40s seem too expensive, call us and we can walk you through a variety of options to fit your needs.

Reasons why people 50+ need life insurance.

  1. Paying for life insurance can provide you with peace of mind which can outweigh the cost of premiums. To make sure your spouse or family isn’t left with bills or debt to pay off themselves, your life insurance would cover these expenses.
  2. If your retirement account isn’t as much as you would like, you may want to switch to a permanent life insurance policy. It can enhance your spending ability so you can have fun during your retirement.
  3. In addition to the savings advantage of purchasing a whole life insurance policy, there can also be tax advantages depending on your policy.

Additional Notes: It’s important to pay attention to how much coverage you are buying. As you age, life insurance tends to get more expensive so if you are over-insured you could be overpaying by a lot.

Deciding to work with an insurance broker may be the best option as you age. They can find you the best deal by collecting quotes from multiple insurance companies. A good agent will know which companies can offer the best rates for your health profile. Contact an advisor at The Accel Group today to learn more about your life insurance options.