You’ve seen the ads before on television before telling you that you need to buy life insurance. You’ve also most likely received a few letters in the mail, too. If you have young children and a spouse who depend on you financially, life insurance is a must. The problem, however, is that most Americans avoid getting a life insurance policy because they think it’s too expensive. The truth is that protecting the ones you love doesn’t have to cost a lot. These tips can help you to give your family peace of mind with life insurance while saving money at the same time.
Choose Term Life Insurance
There are two types of life insurance policies, term life and whole life. While there are a few times when whole life insurance is necessary, such as having children with special needs or a complex estate, most people are fine with term life. Term life gives you insurance for a set amount of time, such as 15 or 20 years, and no cash value. As a result, these policies tend to cost significantly less.
Ross Quade of FinalExpenseInsurance.com explains, “You actually have several types of insurance products to choose from these days. It is important you talk to an insurance agent so they can help you make the best decision for your situation.”
Buy Only What You Need
There’s no exact formula for determining exactly how much insurance coverage you’ll need. You should base the amount on how much money you believe it will take for your family to remain financially comfortable in the event of your unexpected death. You should also take into consideration making sure that there is enough to help cover college tuition for your children. It’s important to reevaluate your policy every time you have a major life change, like a new baby. You should also analyze your policy every couple of years, which will allow you to revise your total based on different factors, including reductions in the amount owed on your mortgage and other financial obligations.
Buy Sooner Rather than Later
The cost of life insurance only goes up the older you get. At the same time, there may be less insurers willing to work with in the event that you develop health issues as you age. Consider buying life insurance as soon as the need arises, or even sooner. The younger you are, the less you are likely to pay, and the more likely you are to lock in a better rate.
Pay Upfront if You Can
Typically, you can pay your life insurance premiums monthly. Some insurers charge monthly fees. Find out if you can pay annually. If you can swing it, pay for the whole year in one go. There are some companies that will provide discounts for doing so. These discounts can be as high as 8% in some cases, which can really add up during the course of 15 to 20 years. There are also some insurance companies that will charge less if they can transfer the premium directly from your bank account.
Take the Medical Exam
While taking the medical exam for a life insurance policy might seem like a hassle, it’s highly recommended that you do so. For one, the exam isn’t really all that bad. Secondly, skipping out on the exam, or opting for a non-medical exam, is going to cost you big time. Without an accurate assessment of your health, insurers have to account for the added risk. Whether you’re perfectly healthy or if you have a few medical issues, you’re likely to pay less in premiums if you simply take the exam.
Improve Your Health
Certain health issues, such as high blood pressure or high cholesterol, can lead to higher premiums. So, too, can habits like smoking cigarettes. It’s possible, however, to have a reassessment done if you can show improvements in your health. For instance, you start exercising and lower your blood pressure or you quit smoking. When you can prove these improvements in your health, you may be rewarded with lower premiums.
Not all life insurance policies are created equal. You don’t have to settle with the first advertisement you see or letter you receive. It’s highly recommended that you shop around. There are plenty of insurers out there, and you’ll find that your monthly premiums will vary widely from one to the next, even for the same amount of coverage. Do your research and shop around to find the best deal for you.
When you have children and a spouse that depend upon you financially, life insurance is a must. Just because you should have it though, doesn’t mean that you need to spend a fortune. With these tips, you can protect the ones you love without breaking the bank to do so.