Tuesday, June 4, 2013
What is a Proper Age for Life Insurance?
Life insurance is something that that some people just own as standard and other people journey just have when they have to. There are many reasons why having life insurance may or may not be a good idea. It is dependent on age, but very much determined by your responsibilities in life expectancy. Life insurance appropriation is discussed in more detail below.
As a singleton
If you are not in a long term relationship and have no dependents, then you may not feel that life insurance is for you. It is something that will pay out on death and may be something that would normally be considered to provide some money for dependents if a person dies. However, it can be worth taking it out to cover the cost of a funeral or any other expenses that may occur at death. There may also be family such as parents or siblings that a person may like to have some money after they have died.
As a spouse/partner
It is more likely that life insurance will be deemed as necessary if in a relationship. There may be shared expenses that need to be covered or it may be felt that it would be a nice gesture to leave something for the partner. The life insurance could be set up to pay out a lump sum which could be used or invested or it could be set up to provide a regular income which could be very useful.
As a parent
If you have dependents, such as children, then it is likely that you will want to make sure that they are well provided for if anything happens to you. Life insurance could provide a good sum of money that will help to pay for day to day expenses. It may pay off some debts or bills or even provide an income. It can help a mommy/daddy/family with any funeral costs, inheritance tax or other expenses that may need to be covered.
As a homeowner
If you have a mortgage, then you will have to get life insurance to pay off the mortgage should you die. This will last only for the term of the mortgage and only pay out enough to cover the value of the mortgage. This is useful as the house will then be paid off so no one is left with the responsibility of having to find the money to pay the mortgage.
In retirement
In retirement it may be felt that it would be good to have some life insurance to pay out to loved ones in death. If there is not much to inherit, it could mean that there will be a nice amount of money to help those left behind.
When taking out life insurance, health and age are considered. This means that taking it out at a younger age is a lot cheaper. It is therefore worth considering this as well, when thinking about having it. It may be worth buying a home in a journey at a young age as the insurance will be less than if you do it older. It may be better to save up money to leave after you die, rather than pay life insurance in retirement which could be very expensive.