Why Life Insurance Should Be a Priority for Everyone Over 30

The Importance of Life Insurance: Age 30 and Younger | NEA Member Benefits

I don’t usually make broad statements, but I believe everyone over 30 should start considering life insurance. If you’re in your 30s and don’t have life insurance, it’s time to think about it.

Although no one likes to ponder their mortality, life insurance is a valuable tool for reducing the financial burden you might leave behind for your loved ones. Moreover, various types of life insurance can help you build wealth and diversify your assets.

Here are four key reasons why everyone over 30 should start considering life insurance:

THE INSURANCE AT YOUR JOB IS PROBABLY NOT ENOUGH

By now, you may have realized that the life insurance coverage provided by your employer is likely insufficient. While it’s great that some employers offer life insurance as part of their benefits package, the coverage amount often falls short of your actual needs.

Your insurable need is the amount of life insurance you should have, based on factors like age, liabilities, and health conditions. A common guideline is that your life insurance coverage should be 7 to 10 times your annual income. For example, if you earn $60,000 per year, you might need a policy worth $420,000 to $600,000, depending on your circumstances. However, the average employee life insurance policy is only around $25,000 to $50,000, which is not nearly enough.

Furthermore, if you leave your job, you’ll lose your insurance benefits. This is why it’s crucial to have your own life insurance coverage, independent of your employer. Many people change jobs every 2 to 3 years, so it’s unwise to rely solely on employer-provided life insurance.

Term life insurance is quite affordable, and you can get a free quote in just a few minutes from Bestow.

YOU WANT TO PROTECT LOVED ONES FROM A FINANCIAL BURDEN

You don’t need to be married with kids and a house to consider life insurance. However, many people in their 30s start focusing on these milestones.

If you have children, a mortgage, etc., it’s essential to think about how your partner would manage if something happened to you. Would your children still be able to go to college? Could your spouse keep the house? Life insurance can help answer these critical questions.

Even if you’re single and at the peak of your career, many people in their 30s carry debt, like student loans and personal loans. Did you know that some student loan debts aren’t forgiven upon death? You likely don’t want to pass on financial burdens to your parents or other loved ones who would have to pay off these debts.

Life insurance provides a tax-free payment to your beneficiary, which can cover everything from debt payments and loss of household income to funeral arrangements and more.

30 IS STILL YOUNG ENOUGH TO LOCK IN AFFORDABLE RATES FOR WHOLE LIFE INSURANCE

If you’re considering life insurance, whole life insurance, in particular, is a worthwhile option. Whole life insurance is permanent and builds cash value as you pay your premiums.

Other types, like variable whole life, even allow you to invest some of the cash value to grow the amount faster. You can borrow against your cash value, use it to pay premiums, or withdraw it while you’re still alive.

Although whole life insurance is generally more expensive than term life, costs increase as you age. If you’re considering whole life insurance, it’s best to get a policy while you’re younger. At 30, you’re not too old to secure a decent rate for your premiums. Plus, you have enough time to build cash value that could be useful in the future.

GET INSURED AND PROTECTED FROM MEDICAL ISSUES

Life insurance primarily provides financial relief for your loved ones. Depending on your policy, you may be able to obtain ‘living benefits’. Living benefits are an insurance rider that can be added to your term or whole life insurance policy.

Living benefits allow you to use some of your life insurance coverage to pay medical expenses for a serious illness or condition. While this will reduce the benefit provided to your beneficiary, it can help cover medical bills that might otherwise be left for your loved ones.

No one likes to think about getting sick or becoming terminally ill, but planning for both the best and worst is part of adult life. As you get older, your health may decline, but if you’re still healthy in your 30s, it’s the perfect time to lock in a life insurance policy and consider adding a living benefits rider.

SUMMARY

Life insurance should be a part of everyone’s financial plan. Understanding its importance can be life-changing. If you’re over 30 and still don’t have coverage, consider the reasons to get a term or whole life policy. Evaluate your current and future needs and weigh the pros and cons carefully.

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