As a personal finance blogger, this is embarrassing to admit. I’ve talked about it for years, but now I’m finally getting serious. The truth is…
We don’t have any life insurance.
We once had a small policy provided through past employers, but that stopped nearly two years ago and it no longer provides any protection for us.
We will definitely secure life insurance before starting a family, but there’s no harm in beginning the search now.
Life insurance is extremely important.
The primary reason most people buy life insurance is to protect the loved ones and dependents who rely on their income. A policy can help cover ongoing expenses so family members can grieve without immediate financial pressure. Beyond that, life insurance serves several other important purposes.
Below are four common reasons you might need life insurance. Even if you think you don’t, one of these situations may apply to you—so keep reading.
If you are shopping for life insurance, consider researching reputable providers and comparing quotes to find the best fit for your needs and budget.
1. Do you have a family?
If you have a spouse, children, or anyone else who depends on your income, you should have life insurance.
A policy can help your family cover everyday living expenses and any debts you leave behind. It can also help pay off a mortgage, fund college tuition, or replace lost future earnings so loved ones can maintain their standard of living.
Ask yourself: what would your family do without your income? Would they face severe limitations?
2. Has anyone co-signed a loan for you?
If someone co-signed a loan to help you qualify—whether for a car, student loans, a mortgage, or other debt—you should absolutely have life insurance.
Too often people overlook this responsibility, and when they pass away the co-signer is left responsible for the remaining balance. Life insurance proceeds can be used to pay off debts so your co-signers aren’t burdened with your obligations.
It’s the responsible thing to do for people who trusted you enough to co-sign.
3. Are you young and healthy?
Young, healthy individuals typically qualify for lower premiums. Because rates are often cheaper earlier in life, many people can lock in a lower-cost policy by buying while they’re young.
Securing coverage now can provide long-term peace of mind at an affordable rate. That’s one reason we’re considering a policy even before having children.
4. Do you know how much a funeral costs?
Life insurance can help cover funeral and final expenses.
The average funeral ranges from approximately $7,000 to $10,000. If something happened unexpectedly, who would pay for those costs?
It’s uncomfortable to think about, but planning ahead is part of being responsible and caring for your loved ones even after you’re gone.
Do you have life insurance? Why or why not? If you do, how much do you spend each year?