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At What Age Should You Buy Life Insurance?

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The right time to buy life insurance depends on the person and their individual needs, but typically most people will start preparing for death later than they should.

While it’s true that the likelihood of an accident or poor health increases as you age, it doesn’t mean you’re indestructible. If you feel like you’re too young to buy into life insurance, keep reading. 

Buying Life Insurance Now is Better Than Later

The first time you read this sentence will be the youngest you’ll ever be, making now the ideal time to buy life insurance. The younger you are, the less likely you will suffer from chronic health conditions and the less likely you will die suddenly.

Life insurers will offer younger people better premiums, thus saving you a lot of money in your 40s, 50s, and 60s.

What if buying now isn’t an option?

Younger people are responsible for a lot of debt: a mortgage, car loan, student loan, or a credit card balance makes it nearly impossible for many 20-somethings to afford life insurance. 

However, buying life insurance later could have a significant economic impact on your and your family’s financial futures. That impact changes depending on your insurance type:

  • Term Life: Provides a lump sum payment if you are diagnosed with a terminal illness or pass away. If you’re young and paying off a mortgage, loan, or credit balance, a life insurance policy will give your partner enough money to make payments.
  • Total and Permanent Disability: Provides a lump sum if you’re unable to work or disabled. This option is beneficial for people in high-risk jobs, couples who just had a baby, or for singles who don’t have anyone to rely on or are in charge of elderly parents.
  • Trauma (Critical Illness): Provides a lump sum if you experience a medical trauma, like a heart attack, cancer, or limb loss. This can remove the worry of financial strain that may occur if you’re unable to work and have no savings or a personal nurse.
  • Income Protection: Provides a monthly payment to a certain percentage of your income if you can’t work for an extended period due to injury or serious illness. This type of insurance is beneficial for practically anyone because accidents can happen.

Life insurance removes the financial stress from yourself, your partner, your children, and your family should something happen. Life insurance will even pay for your funeral expenses.

Life Stages for Life Insurance

There are other ways you can decide whether or not you should start paying for life insurance. For example, many insurers go by a “life stage” policy that helps point younger people in the right direction. You should buy life insurance if you experience one of these milestones:

  1. Marriage or Divorce
  2. Purchasing a Home
  3. Family Health Emergencies
  4. Having Children
  5. Personal Trauma or Illness

If you have someone you need to take care of, or you’ve personally been affected by the loss of a family member due to illness or trauma, you should get life insurance right away.

Too often are young couples forced to shoulder the debt of a loved one that they can’t afford. If you’re already just getting by, life insurance could save you and your family when you really need it.

At the same time, you don’t want to wait to buy permanent life insurance, even when you’re well off, because your premiums will skyrocket. On average, a 30-year-old will save $15,000 on a 40-year policy length than they would if they got the same coverage amount at 40. 

However, this assumes they were still in the best health possible at 40. If not, the 30-year-old would save even more money, possibly $29,000 over the policy’s lifetime. 

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