When should I buy life insurance? How many times have you thought about it? If you have recently graduated, you plan to purchase your first home, you just got married or welcomed a baby, then there’s quite likely to consider the following two statements correct:

• You want to provide for your loved ones
• You cannot predict your future

No one can tell when their life will end, but they can prepare for this, and ensure their loved ones are protected if it happens. The right life insurance gives you peace of mind because your family benefits from financial support if you pass away.

Do you know what life insurance is?

Your dependents receive money if you die. The funds can come as regular payments or as a lump sum. It brings you peace of mind because it assures you that your loved ones don’t face financial issues when you’ll no longer be around.

The provider and the type of insurance you buy determine how much your dependents will get. You decide the purpose of the life insurance because many providers ask you to state what expenses you want your dependents to cover with its help. You decide if they receive regular payments, if they get a lump sum, if the funds are used to pay the mortgage, and so on.

Types of insurance

The insurance provider will ask you to choose from four types of life covers, whole life insurance, term life insurance, universal life insurance and variable universal life insurance. These are the main types of coverages, but some providers offer even more variations, so you should check with your local ones.

• The term life policy runs for a limited period, like 10 or 15 years, and it pays out only if you die during this interval. The provider will offer no lump sum at the end of the period.
• The whole life policy pays your dependents no matter when you die if you keep up with all the payments until them.
• The universal life insurance is similar to the whole life one, but it has a flexible premium structure and it allows you to apply for cash withdrawals or even full surrender.
• The variable universal life insurance has a cash value account that doesn’t pay a determined sum. You can withdraw and surrender the cash value when you want.

Should you get life insurance if you are in your 20s?

Many young people think they need no life insurance policy because they are young and healthy.

But if you have financial responsibilities, you plan to marry or you have a loan, then you should get a life insurance coverage. Both a term or a whole life insurance policy would bring you peace of mind because it will reassure you that your loved ones get financial support if you die.

If you die before paying your debts, and your parents or spouse have co-signed for your loan they’ll have to pay it. If you rented a house together with your partner, they’ll have to cover all the expenses only from their paycheck. If you have an insurance policy it pays money, they can use to cover what you owe or expenses they cannot afford.

When in your 20’s you should get  life insurance if someone depends on you because you don’t want to let them struggling financially and dealing with the loss of a loved one.

Should you get life insurance in your 30s?

As you get older, you’ll face different financial challenges. It’s likely to have children to look after, to have a house mortgage, and other additional expenses. When dealing with so many financial issues it’s recommended to get as much coverage as you can because it’s helpful if you die.

If you bought a term one when in your 20s, this may be the moment to change it and opt for a whole life one. Most of the youngsters choose term policies because they’re more affordable. Permanent insurance on the other hand is more expensive, but it protects your family from the effects of an unexpected death.

Your job may offer you life insurance, but it’s advisable to maximise it with a personal one. It’s a great idea to have your own individual life insurance, alongside the one your employer offers because you are working in an insecure job market. When you leave behind the company, you also leave the insurance and hope the next employer will offer better benefits. But the laws don’t require employers to offer life insurance, and this is why workplace insurance should be a bonus to your coverage.

Life Insurance

How to decide what life insurance fits you best?

As you have seen, insuring your life is an amazing idea, no matter your age. You don’t want to leave your family without financial protection, and getting life insurance is the best solution. But how do you opt for the right one? When buying it, you need to assess your current situation, identify your main goals, and determine how much you afford to purchase. As stated before, term and whole life insurances are not the only coverages available on the market, so you can find another solution that better suits your needs.

Before choosing one, you should compare the offers your local providers have, and analyse their ups and downs. To better understand how much protection you should get, you can use an online calculator.

Some people even prefer to combine term insurance with permanent coverage. For example, you can purchase 20-year term insurance to protect your family if you die while you have a mortgage on your house. And you can get a permanent insurance to cover the other expenses when the first one expires. The greatest advantage it brings to your dependents is that the funds they receive aren’t taxed as income and they get the full sum.

If you have further questions you should research online or get in touch with a provider to support you in choosing the right option.