Absolute Retirement Solutions

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When Should You Get Life Insurance?

Is there an optimal age or stage of life to purchase a life insurance policy?

Life insurance policies are priced based on the buyer’s age. The older you are when you purchase the policy, the more expensive it will be. So, if premium amount were the only consideration, then the best age to purchase a life insurance policy would be right at birth. It’s actually not the most uncommon practice for parents or grandparents to purchase life insurance for a young child. The cash value of a whole life policy can accumulate a considerable value over a long period of time. That cash value could be used later for college tuition or a down payment for a house, or any other purpose.

However, if you’re wondering when should you get life insurance, you probably don’t have a permanent policy that was bought for you in your childhood. The best answer depends on your unique situation on whether you need life insurance, what type, and how much. While the sooner you purchase a life insurance policy, the more inexpensive the premiums will likely be, your insurance needs will be unique to you. For example, those with families to support, a mortgage to pay or higher debts may need coverage sooner – and more of it – than someone who has no dependents and little to no debt. Unfortunately, many young adults can’t or don’t prioritize life insurance when they need it, as they tend to have lower incomes and higher debts than older adults. If you can afford to get insured when you are still young and healthy, you could save a significant amount in the long run.

We recognize that not everyone can afford life insurance payments in their 20s. Think about these life situations and the life insurance considerations that go along with them.

  • If you are a single person with no dependents , there may not be true need for you to have life insurance. While it would save you money over the long-term to have coverage now, there is likely no one who will be financially impacted by your untimely death if it occurs. If your parents have financial troubles, you might want to consider taking out a small policy to cover your funeral expenses.
  • Married couples who have just purchased a home may want to consider purchasing life insurance. In the event that the person paying the mortgage dies, the policy can cover that and other living expenses for the surviving spouse.
  • New parents and couples expecting a baby often take out their first life insurance policies, as they now have a financially dependent child. If you don’t have already have a life insurance policy, this is often an essential time to purchase one. Remember, the longer you wait, the more expensive your policy will generally be. You will also be more expensive to insure (and potentially uninsurable) if you have medical problems. Many young adults overestimate the cost of life insurance. The best thing you can do is sit down with a qualified life insurance agent and discuss your situation. Absolute Retirement Solutions is an independent insurance agency based in the Kansas City metro area. We can help you identify what type of policy meets your needs and walk you through your options in a no-pressure environment. Learn more here , or give us a call at (913) 254-3030 in order to speak with an agent.

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