Is there a best time to buy life insurance?

This question may seem difficult, but the answer is simple. Are you in a situation where your death could impose a financial hardship on others? If the answer is yes, then it’s time to buy life insurance. We all have different events throughout life that could make us reconsider what’s important. It’s a good idea to start with coverage that fits your current needs. You can increase the benefit later as life changes and you have more on the line. The following are a few situations to consider:

You are married, or soon to be

Now that there are two of you in the picture, it’s important to begin thinking about long-term financial security. If one of you were no longer around, would the surviving spouse be financially secure? Would there be enough to cover funeral expenses, credit card or other debts? If not, life insurance can help bridge this gap.

You have children, or about to start a family

Now you’ve upped the ante. You have dependents that rely on you. You want to protect your family and make sure expenses, including education, are taken care of. CNN Money states that the average cost to raise a child to age 18 is around $233,610.¹ Even if the surviving spouse works, would that income be enough to cover the loss of your salary? In addition, the surviving spouse may need to take over your part of the parenting and household duties, which could compromise his or her job.

You are a homeowner, or will be soon

Owning your home creates a wonderful sense of security, until you realize that if your paycheck disappeared the outstanding mortgage could be a burden to a grieving spouse. A term life insurance policy is a good way to pay off the mortgage and other debts should something happen to you.

You are retired, or nearly so

Perhaps you are caring for grandchildren or a disabled child. Or, should you die, your spouse could outlive you by 10 or 20 years, or more. Is there enough in your nest egg to make sure your dependents are covered, or that a comfortable lifestyle can continue for the rest of your spouse’s life?

Single and happy

You may think you’re off the hook, but most likely you still have some financial responsibilities, such as paying off credit card or college debt. According to the Institute for College Access & Success, 68% of graduates each average $30,100 in loans.² Also, more and more singles are helping out older parents. If something happened to you, what would happen to them? Life insurance can be very affordable when you’re young, and it’s a great way to boost your financial plan.

Citations:

¹ CNN Money: "It costs $233,610 to raise a child." by Kathryn Vasel, January 9, 2017,  http://money.cnn.com/2017/01/09/pf/cost-of-raising-a-child-2015/index.html
² The Institute of College Access & Success: "Project on Student Debt",  http://ticas.org/posd/home

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