You know what they say about your 30s… It’s the best time to buy life insurance.
Of course, you can celebrate entering a new decade with a dream vacation or birthday party, but hear us out.
Buying life insurance in your 30s is often one of the most practical, impactful and affordable times to secure coverage. (And, it’s not a coincidence that the average Haven Term customer is in his or her mid-30s.)
Trust us, your forty-year-old self will thank you for not putting this off.
Why you need life insurance in your 30s
Life insurance provides a financial safety net to your family if you were to pass away. While it’s essential if you have people who financially depend on you, like a spouse or child, it’s important to also consider how the people in your life would be affected if you were to die.
Most of us would like to leave a legacy to those we love or to causes that we care about. And that answer holds true whether you are single, married or have kids. Life insurance can help you achieve that mission.
Buying a policy now, while you’re young and healthy, can lock in affordable rates and give you peace of mind for the future — and tick one impactful to-do off your list. Here, why many people in their thirties purchase life insurance.
#1: To financially protect your family
In your 30s, life moves pretty fast, and if you recognize that quote, it definitely means you’re in the ideal age bracket to consider purchasing a life insurance policy.) You may, rather suddenly, find yourself buying a house, getting married, or having a child in the next few years, if you haven’t already.
The proceeds from a life insurance policy can be used by your partner, kids, designated guardians, or parents to help pay for the mortgage or rent, funeral expenses, childcare, and the many other day-to-day bills we all have.
It’s selfless and alleviates a significant financial burden for your loved ones.
#2: To make sure your child has everything you wish to give them
Consider it a very important first gift to your child. Parents have countless hopes and dreams for their children that, unfortunately, cost money to make happen. Buying a policy now helps ensure that your family has money to continue affording those plans. Knowing that your child is protected, and will have a life insurance policy payout to put toward things like taking dance classes, going to camp, or attending college, even if you were no longer here, is one way to begin leaving a legacy for your child.
#3: To lock in affordable pricing
You may still be ID’ed at the bar, but life insurance applications look at your biological age — not how old you look or feel. And while healthy lifestyle choices, like abstaining from smoking and exercising, play some part in how a policy rate is determined, the truth is that the age you are when you buy a policy impact pricing substantially.
For example, a healthy 30-year-old woman can purchase a 30-year, $500,000 Haven Term policy issued by MassMutual for about $34 per month. If she waits until 40 to buy a policy, the starting price for the same amount of coverage would be $53 per month.
#4: To avoid medical hurdles in the future
It’s an annoying truth: The older you get, the more statistically likely you may be to be diagnosed with certain diseases that may make you ineligible for a term life insurance policy — or may cause rates to skyrocket.
No one has a crystal ball that can tell you what your health will be like 6 months, one year or five years from now. Therefore, if you know you have a need for coverage, lock in that affordable pricing while you can.
#5: To protect co-signers and loved ones from debt
A mortgage, student loans, car loans, credit card debt … many of these do not just disappear when you die. Some personal debt such as federally-funded student loans or private credit card debt may be forgiven.
However, private student loans, car loans, and mortgage will often still need to be paid and can be left to your co-signer or spouse to continue paying without your income. If you have any co-signed assets, then it’s important to consider buying a life insurance policy to protect your ability to pay off those loans. It’s also important to think about all the other things that your loved ones may be on the hook for if you were to die.
#6: To cover burial expenses
Many family members go into sticker shock when they get quotes from funeral homes for burial expenses. While it may not be pleasant to think of the cost of burial, the costs of a funeral, cremation or burial, and a memorial marker can easily cost upwards of $8,000, according to the National Funeral Directors Association.
If you didn’t have life insurance, your spouse or other immediate family members would need to come up with the cash to pay these expenses at the same time they’re grieving your death. Far from ideal.
#7: To protect your business
If you have any business dealings on the side, life insurance is essential. Let’s say you buy and sell real estate for a profit. What would happen if you passed away in the middle of a deal? What if you flip houses for a profit? How would your family handle your project if you passed away during a flip or a major remodeling job?
Your family could face similar struggles if you run a small business that buys and holds inventory, has business-related debt, or has ongoing business expenses to cover. If you buy enough life insurance, on the other hand, you can leave behind enough cash so that your family could deal with your business holdings the way you would have wanted.
#8: To get it over with
Want something simple to check off your to-do list? Apply for life insurance.
Thanks to modern technology, buying a policy is easier than ever. It’s not something you need to put off because you think it’ll be a hassle. It isn’t.
Once you’re approved for a policy, your rates are locked in, and your policy is active through the specified term length, as long as you continue to pay premiums.
Peace of mind might be closer than you think.Learn more
What kind of life insurance should a 30-year-old buy?
There are two types of life insurance that are commonly purchased: term and permanent. Term life insurance provides a simple, straightforward way to help financially protect your family during the years they need it most – such as until the mortgage is paid off or your kids are in college.
Permanent life insurance comes in a few varieties – the most common being whole and universal life. Unlike term, permanent policies provide coverage for a lifetime and include a cash value component that can grow or decrease over time. These features are why permanent policies can cost anywhere from 5 to 20 times more than a term life policy.
So, which is the right choice for an individual in his or her thirties? That will depend on your budget and what you want from a life insurance policy. For many, though, term life insurance is a good, affordable way to secure coverage.
How much coverage does a thirty-something need?
While individual life insurance needs vary, you can get a general sense of your coverage needs by taking a closer look at your income. If you’re earning $75,000 per year and want to replace your income for 5-10 years (a standard recommendation from experts), you’ll need a term policy for $375,000 – $750,000.
Take into consideration the following when choosing a coverage amount:
- Lost income and living expenses, like rent or daily bills
- Debts you leave behind
- Childcare if you are a stay-at-home parent
- Burial, estate taxes, and other final expenses
- College expenses for your children
- Unpaid medical bills or taxes
If you have children, carry substantial debt, or have a side business, you may need more. The best way to get a personalized coverage recommendation is to input your information into a life insurance needs calculator. By sharing some basic details about your income, your family structure, debts and more, you can find out how much coverage is right for you.
What’s the best term length for someone in their thirties?
Term life insurance policies are relatively simple to research and buy. Beyond selecting a coverage amount that works, you need to decide how long you want your policy to last.
Fortunately, you have plenty of options available to you, especially in your 30s. You can buy term life insurance coverage for 10, 15, 20, or 30 years depending on your needs. While longer policies tend to cost more each month, they do offer a longer span of coverage that may bring even more peace of mind. For example, a longer term length means insurance coverage could be in place for the duration of your 30-year mortgage or until your partner is near retirement.
Shorter-term policies, on the other hand, offer short bursts of coverage meant for a particular need. For example, a short, 10-year business loan that you wouldn’t want your family to be stuck with. “Laddering” policies is a common way to help ensure adequate financial protection from life changes without needing to purchase another large, long-term policy.
Choosing a term length does not need to be a confusing task. An online life insurance calculator will take into consideration the ages of your children and debts you have to recommend a length that will adequately protect your family. On average, we find that most Haven Term policyholders purchase a 20-year policy.
Why buying life insurance in your thirties is simpler than you may think
Look, purchasing a life insurance policy may never show up as one of those memorable moments on your Facebook feed or social media timeline, but taking the time to research and choose a policy also won’t pull you away from planning a blowout bash or taking a major “grown-up” vacation. An online application can provide instant rates and coverage options that will last you through the next few decades. So, apply for a policy, revel in your newfound maturity, then kick back and rewatch Ferris Bueller’s Day Out. You’ve earned it.
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Anna Davies is an editor at Haven Life. She has written for The New York Times, New York Magazine, Refinery29, Glamour, Elle, and others, and has published 13 young adult novels. She lives in Jersey City, NJ, with her family and loves traveling, running, and trying to find the best cold brew coffee in town.