Don’t let money get in the way of protecting your loved ones.
- Setting up life insurance could protect your family in the event of your death.
- There are steps you can take to pay less for your insurance and make it more affordable.
Having health insurance could save you a world of financial upheaval if you were to injure yourself or fall ill and need major medical attention. Likewise, having life insurance could save your family a world of financial distress in the event of an untimely death.
But in a recent investigation According to ConsumerAffairs, 38% of respondents say they don’t have life insurance for one key reason: they can’t afford it. If this is what kept you from buying a policy, there are steps you can take to spend less on life insurance. Here are a few to consider.
1. Don’t buy too much insurance
One of the main reasons so many people end up spending a lot of money on life insurance is that they get large death benefits that exceed the needs of their loved ones. There are now different formulas you can use to calculate what your policy’s death benefit should look like. You can decide to replace a certain number of years of salary or get a death benefit that will pay off your current debts.
But as a general rule, if you’re the sole breadwinner in your household and earn $70,000 a year, you probably don’t need a $2.5 million death benefit. And if you opt for a lower death benefit – say, $750,000 – you should end up spending a lot less.
2. Improve your health before applying
The healthier a life insurance candidate you present when taking out a policy, the lower the premium rate you are likely to get. This is because your insurer will assume less risk of having to pay out your death benefit. If you work on improving your health before applying, you might get a lower premium cost.
What steps should you take to improve your health? Well, that depends on what it currently looks like. If you are 15 pounds overweight, losing those pounds could result in lower premium costs (you may want to consult a health professional on a healthy way to lose weight). Quitting smoking can also lead to lower premiums.
3. Opt for term life insurance on whole life
Life insurance is generally divided into two main groups. Term life insurance covers you for a predefined period (often 30 years), but does not accumulate cash value. Whole life insurance covers you forever, and it Is accumulate cash value that you can access or borrow down the line.
Whole life insurance generally costs a lot more than term life, so if money is an issue, you might want to stick with a term life insurance policy. If you’re in your mid-30s and set up a 30-year term insurance policy, that’s long enough to cover a surviving spouse until retirement age, at which point the pension income or IRA distributions could come into play.
Paying for life insurance could mean having to give up another expense. But it’s a decision worth making to protect your loved ones. And if you play your cards right, you might end up spending less than you expected on a font.
Life insurance protection for you and your family
While many varieties of insurance coverage are designed to help protect a person’s family and assets, life insurance is an essential type of protection. The right life insurance can help protect the people who depend on you most if you die. Choosing the right life insurance policy is essential to ensure the right protection for your loved ones. We’ve sorted through the different options to bring you our picks for the best life insurance policies available today.