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When is the Right Time to Buy Life Insurance?

Jessica Oaks


While the best time to buy life insurance is, in theory, right before you need it, nobody knows exactly when their time will come. Designed to help provide financial security in the event of death, life insurance can help pay bills, fund retirement, and is a key element in estate planning. In other words, life insurance is a way to provide financial security for your loved ones even after you’re gone.

Whether you are older and need a lot, or younger and need only a little, buying life insurance is an informed decision that takes planning.

Do I Need Life Insurance?

The older you get, the more you probably think about life insurance. Whether you’ve got a family, a mortgage or some other major expenses, what will happen to your loved ones in the event you pass away becomes of greater concern the older you get. But that doesn’t mean life insurance isn’t a good idea if you are young, even if you’re single, relatively free of debt, or both. Regardless of age, it’s not a matter if you need life insurance. It’s a matter of when and how much.

Am I Too Young for Life Insurance?

While most people don’t consider life insurance until they are older, securing a policy when you are young has unique benefits. For starters, the younger and healthier you are, the less expensive it will cost. Securing a 30-year term policy in your twenties, when you are at your healthiest, will protect you as you age into your fifties, build a family and take on mortgage and other expenses.

Conversely, putting off life insurance until you are older and not in the best of health will cost you more. And if you have developed certain preexisting conditions, companies may even refuse coverage at any price. Life insurance can benefit everybody but, when it comes to purchasing, the younger the better, even if it’s for a short term and for low cost.

How Much Do I Need?

The amount of life insurance coverage you need depends heavily on your individual financial situation. However, a commonly used guideline to estimate your life insurance need is to multiply your annual salary by eight to find your desired amount of coverage.

A free online life insurance calculator can help you get an idea of your coverage needs. Once you’ve got an idea how much coverage you need, shop around. Not all providers are the same and you can actually save quite a bit on monthly premiums by comparing insurers. State Farm is an insurance industry leader and trusted insurer, but there are other providers who provide reliable life insurance coverage. Be sure to look into all your options before buying to help ensure you get the best possible deal.

What Type of Life Insurance Coverage is Best?

With two main options (term life for a more affordable premium for a specified period of time and whole life for more expensive but comprehensive coverage), you do have options. So many options, in fact, that consulting a financial professional may be helpful.

It is just as possible to get too little coverage as it is to buy too much, but a life insurance or financial professional can help you avoid these pitfalls by properly factoring in financial considerations such as your current situation and your family’s future needs.

Is Life Insurance for Me?

Life insurance is for everybody. How much you need is the question, and the more information you have, the more informed your decision will be, for you and yours for years to come.

Jessica Oaks is a freelance journalist who loves covering technology news and the ways that technology can make life easier. Follow her on Twitter @TechyJessy.

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