3 reasons to buy life insurance
Life insurance may not seem like a priority when you're young and don't have family responsibilities. You may be wondering why you need insurance coverage, who will benefit, and how it can save you money later.
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| 3 reasons to buy life insurance |
Here are some reasons why purchasing life insurance at this time is a wise financial move.
1. Life insurance premiums depend on your age and health
Obtaining life insurance coverage can be easier when you are young and healthy. Your age and health at the time of application determine the life insurance plans that insurance companies provide and price. Life insurance companies know that the younger you are, the more likely you are to survive for many years. This makes ensuring them less risky and cheaper—and perhaps less expensive than you might imagine.
Obtaining life insurance before unexpected health changes occur can be beneficial. Insurance companies also base their pricing on the answers you provide to health-related questions. These answers help insurance companies determine your likelihood of staying healthy.
2. The cost of living (and insurance) increases as you get older
Your expenses will undoubtedly increase as you get older and advance in your career. Your budget should change depending on where you decide to live, whether you buy a house, and especially whether you decide to get married and start a family.
Your life insurance coverage must also grow to reflect these changes, and if you purchase life insurance early—before these different life stages—the cost of modifying your policy over time will likely be less than the cost of purchasing a new policy later in life. . By taking advantage of lower premiums when you're younger, you'll save money on insurance costs later.
3. With term insurance, you may be able to get more money right now
Since it is usually more affordable to purchase a policy when you are younger, you may be able to get more life insurance. Term insurance, as the name suggests, is life insurance that provides coverage for a specific period of time (“term”) at a fixed rate that will remain the same for the duration of the policy. In general, term insurance policies tend to be more affordable than whole-life insurance policies, saving you more money.
Life insurance is primarily meant to safeguard your income and the people who rely on it. As your life grows and changes, it's crucial to make sure you're covered every step of the way. Getting life insurance early can set you up for greater savings and better financial protection in the future.