When should you buy life insurance?

BY RACHEL LAYNE

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Milestones like getting married or having children can be a good time to assess when you need life insurance.

Life insurance can help ensure that people who depend on you have a financial safety net in the event of your death.

In exchange for regular payments made over time to an insurance company or through an employer, people you designate as beneficiaries get an agreed-upon sum when you die through your life insurance policy.

There are two main kinds of life insurance, offered in a variety of forms: term life insurance and permanent life insurance. The most common kind of permanent insurance is called whole life insurance. Term life insurance offers coverage for a set period of years. Permanent, or cash value, covers your entire lifetime (premiums can cost more).

Either form of life insurance will provide financial protection for you and your loved ones. So, if you don't have life insurance, or want to supplement what you currently have, it's worth exploring your options. Get started with a price estimate today.

The type of insurance you purchase will depend on your financial situation. But when is a good time to buy life insurance? In general, experts say the earlier the better - but it also pays to examine your specific needs like dependents and individual financial situation. Consider your whole financial picture and future needs.

As usual with personal financial decisions, there are advantages and disadvantages to consider. This is especially true when determining the time frame for purchasing life insurance.

Buying life insurance at a younger age means

• Monthly premiums are generally less expensive
• You have time to build more cash value in a whole life policy
• Expenses like mortgage payments can be covered if you die unexpectedly
• A spouse, partner, children, or business partner that depends on your income for everyday costs won't be left in a lurch 
• The payout can cover expenses and debts you leave behind

Yet it's also never a bad idea to look into life insurance, even if you haven't thought about it before (or couldn't yet afford it). You may have dependents, bills, and other expenses you still need to be covered. Or, you may want to leave an inheritance. There are multiple advantages to having a life insurance policy in place, regardless of the type you choose. Speak to an insurer today who can help guide you to the right choice. 

Buying life insurance at an older age means

• You'll pay more in monthly premiums
• You won't have as long to build cash value if you choose a whole-life policy, and less to cash out if you need to liquidate that policy sooner
• You may have fewer good policy choices
• You may be able to cover certain outstanding debts
• You can still leave part of the benefit as an inheritance
• The payout can still help your dependents or partner cover expenses

Certain milestones can also be a good time to consider life insurance:

• When you land your first job. Some employers offer policies as a benefit. 
• When you get married. Your spouse will have funds to cover lost income.
• When you start a family. Your children, spouse, or partner may count on your income for everyday expenses. Shopping for a life insurance policy now can help cover those expenses for generally lower monthly premiums.
• When you buy a home. If you have a mortgage, it can be a good idea to buy life insurance to help beneficiaries keep up payments after your death.