When Should I Get Life Insurance?

Someone Relies on Your Domestic Labor

Life insurance can also be important for spouses who are not the primary earners of their household but facilitate their family’s lifestyle in other ways. The financial implications of losing a stay-at-home spouse can be devastating. If your family depends on you to provide childcare, prepare meals, clean, and perform other essential household tasks on a regular basis, someone will need to continue that work after you pass away. Your spouse may be faced with the immediate expense of finding professional childcare. Additionally, your passing could lead your spouse to work fewer hours and limit their earning potential so they can spend more time taking care of the home. Alternatively, they might decide to hire someone to outsource some or all of the homemaking responsibilities. Either way, your death will leave a major financial impact. Appropriate life insurance coverage will mitigate those issues and enable the surviving spouse to adapt to new circumstances without additional financial strain.

You Have Debt

If you have a mortgage, student debt, outstanding business loans, or other financial obligations, your untimely death could leave your family responsible for these liabilities. This means that even if nobody relies on your income to meet their daily needs, your passing could still put loved ones in financial trouble. Life insurance can help settle debts, preventing your loved ones from inheriting financial strain along with their grief.

When You Can Forgo Life Insurance 

Purchasing life insurance is a wise decision for most adults, but there are circumstances where it may be unnecessary. In these cases, it can be better to forgo life insurance and put the money you would spend on it toward other uses. 

You Have No Dependents or Debt

Life insurance can be a critical financial planning tool to provide peace of mind and financial security for your loved ones if you pass away unexpectedly. Still, many people are tempted to put off [PRP1] buying a life insurance policy until they are older. Waiting to purchase life insurance can be a huge financial mistake, especially when you know you will want it later in life. When shopping for a life insurance policy, premiums tend to be more affordable the younger and healthier you are, and they can get more expensive the longer you wait. Furthermore, procrastinating getting insurance puts you at risk of leaving your loved ones in a financial lurch if you die without sufficient coverage in place. There are many good reasons to consider purchasing life insurance as part of your long-term financial plan. If any of the following statements apply to you, purchasing life insurance sooner rather than later may be a wise decision.

You Are Self-Insured

If your savings and investments are sufficient to cover the expenses that insurance would have covered, you are self-insured. In the case of life insurance, these investments would replace your income to support your surviving family financially, pay off any outstanding debts that would otherwise be passed to them, and cover funeral costs. Therefore, if you have accumulated enough that you are no longer dependent on a salary and your loved ones could live off your investments and pay for your funeral if you unexpectedly pass away, you do not need life insurance