You know what they say about your 30s…
It’s the best time to buy life insurance.
Okay, so maybe they don’t actually say that, but the point still stands: Life insurance in your 30s is often one of the most practical, impactful and affordable times to buy a policy. (And, it’s not a coincidence that our average Haven Term customer is in his or her mid-30s.)
Your 30s are riddled with numerous changes and responsibilities that drastically impact your finances.
Perhaps you just got married, had your first child, or bought a house. These are all significant life milestones that typically result in you having people in your life who rely on you and your income.
Why You Need Life Insurance in Your 30s
When you have people who financially depend on you, it’s time to get life insurance. Buying a life insurance policy in your 30s allows you to lock in affordable rates while you’re still young and healthy, and is a good time to figure out whether you want a million dollar life insurance policy. It’s a prime time to purchase adequate protection for the long-term.
#1: To Financially Protect Your Family
Many people are married and planning for kids by their 30s. It’s a decade where a lot can happen within a short period of time.
In buying life insurance now, even if you don’t have kids yet, you can help ensure that your spouse has a financial cushion from the unexpected. And, you will have peace of mind in knowing that your partner can cover many debts and day-to-day expenses if you were no longer around.
Financially protecting children you don’t have yet may seem like an abstract concept. However, the moment you lay eyes on your child, reality and the need to protect firmly takes hold.
But, you don’t have to wait until the day your child is born to get adequate life insurance coverage. Be proactive. Get it while you still have the luxury of a little something known as “spare time” (aka, life before kids).
#2: To Lock in Affordable Pricing
Do I need life insurance at 30? Because of the way life insurance premiums are determined, the early bird really does get the worm. Premiums for a term life insurance policy can be very affordable when you’re young but tend to increase with age. For example, a healthy 30-year-old woman can purchase a 30-year, $500,000 policy 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.
That’s part of the reason buying life insurance in your 30s is so smart – you’re old enough to need it but young enough to get a good deal on coverage.
#3: To Protect Co-Signers and Loved Ones From Debt
Adults in their 30s have, on average, anywhere from $82,500 to $185,900 in debt.
Mortgages, student loans, credit card debt, car loans – you name it, you may have this debt in your 30s. It’s imperative to ensure your family is financially prepared to cover these debts if you were no longer around.
Without a life insurance policy, your surviving family members might struggle to pay the mortgage or keep your car payments up-to-date. They may even need to quickly sell off these assets to get out of the debt.
No one would knowingly leave their family to struggle financially. A life insurance policy with an adequate coverage amount should account for replacing your income and paying off your debts.
#4: 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.
#5: To Cover Burial Expenses
Your funeral is not something anyone ever likes to think about. But for a moment, consider this: the average burial now costs around $7,000 to $10,000. Imagine your family members having to deal with that expense at the same time they are grieving your death?
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.
How Much Life Insurance 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.
A life insurance policy should help cover:
- 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 significantly 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.
Choosing a Life Insurance Term Length
Term vs whole life insurance are simple products 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 could help cover your 30-year mortgage or until the kids are projected to finish school.
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, most of our Haven Term policyholders purchase coverage for 20 or 30 years.
The Easiest Way to Get Life Insurance
The best part about being a thirty-something is that you’re likely still in excellent health. If that’s the case, you may be able to get affordable life insurance without a medical exam (and at no additional cost for the convenience.)
Getting quality life insurance today is simpler than ever because of new online options for purchasing a policy. You can get an instant decision on eligibility and pricing and, if approved, start coverage immediately.
Don’t put off buying life insurance in your 30s because of fear of a confusing, time-consuming task. Thanks to modern technology, it’s easier than ever to get high-quality and affordable protection for the people you love most. Having complete peace of mind never gets old.