How do you decide if you need to buy life insurance based on where you are in life? It’s simple: you remember the purpose of life insurance is to protect the people who depend on you financially.
That’s why children typically do not have life insurance purchased on their behalf. No one depends on income from them. The situation is similar for young single adults: if you’re newly independent, the only reason you would typically need life insurance is to pay for your own funeral costs or help support an elderly parent.
The situation begins to change as we grow up and get married. If you’re newly married, you’ll need to decide if either spouse needs life insurance. If each of you earns an income that could support one spouse without the other, then life insurance would only be necessary if you want to cover your funeral costs.
What about established families with dependents? Once you have a family that depends on you (whether a spouse or children), you need life insurance. And it’s unwise to purchase life insurance only on behalf of the partner working outside the home because the cost of replacing someone to handle domestic chores and childcare can cause significant financial problems.
Finally, do you need life insurance when your children have flown the coop? If you do not have people depending on your income for support and you can cover funeral expenses, you may be able to avoid life insurance at this stage in life.
Note, however, that if you decide you need life insurance, purchasing it costs more as your age increases. Your rates will likely be cheaper now than when you get older.
If you need assistance making this decision, we would be happy to help you. Our insurance experts are ready to walk you through your options and determine which coverage makes the most sense for your life stage.