Life Insurance Rates By Age
As life goes on, you'll eventually reach a stage where new financial goals take shape and a few old obligations sit squarely in the rear-view mirror. Perhaps you've begun to plan for retirement or that dream vacation and are mounting a savings campaign to fund those pursuits. Hopefully, most or all of your student debt no longer exists and you've shaken loose some income to apply toward other worthy fiscal objectives.
As you enter peak earning years, start or grow a family, and begin to accumulate assets such as a home or a 401 (k) plan, you simply can't skirt the need to protect those precious commodities. Maybe life insurance has entered the discussion at some point but you haven't felt compelled to put any specific arrangement into action. There are always unexpected twists and turns on the road of life, and it's important to pursue a personal life insurance strategy to ensure your loved ones are cared for in the event something happens. Affordable term policies can fulfill that need — we'll take you through some of the features and benefits:
As with a mortgage, a term life insurance policy lets you choose the exact amount of time you wish to pay for protection. Maybe you've paid off educational or other loans, but chances are, you've taken on home, personal, or business debt that won't just disappear in the event of an unexpected incident. Many policyholders coordinate term lengths with the parameters of outstanding mortgages. If you have 20 years left on the mortgage term, a life insurance plan might work well if it's structured to follow the amortization schedule of the home loan.
Term life insurance is temporary in a way, with death benefits only lasting as long as the number of years you own the policy. Whole life insurance, as the name suggests, is meant to cover you permanently and provide benefits to heirs when the inevitable time comes. As life progresses and financial or health circumstances change, some term policies offer conversion privileges from term plans to whole life policies. This changeover can be transacted even if you incur a debilitating medical condition that would prevent you from qualifying for a life insurance program in the first place.
Whether you consider buying term life insurance or whole life insurance, one incontrovertible fact holds true: The younger you are, the less expensive a policy will be. The number-crunchers in the life insurance industry set policy rates that increase as you move closer to life expectancy, which is calculated at about 79 years of age1 in 2018 for both genders combined in the United States. Thus, a 25-year-old male without any medical conditions would pay much less for a 30-year term policy than his 55-year-old counterpart.
You may not have started a family or accumulated much wealth at 25, but you've probably acquired student or credit card debt. Unfortunately, an untimely demise may not relieve your family members or co-signers from paying off those loans. So, some industry observers suggest that you purchase a policy with a face amount or death benefit equal to five times your current annual income plus2 the amount of any outstanding debt. This way, your loved ones aren't burdened with reaching into their own pockets to resolve final expenses.
Mortgages eventually get paid off, and children eventually leave the roost to become financially independent. But when children and spouses or partners depend on your income, you'll want to secure protection for the maintenance of their lifestyles if you weren't around to provide that support. Monthly bills aren't the only concern here — funeral expenses must also get factored into the equation when you're deciding on coverage amounts for a life insurance plan.
While you consider face amounts and assess affordable payments, know that once you're approved for coverage, the opportunity exists to lock in premium costs for the duration of the policy. Level term premiums won't increase should you suffer an illness that would otherwise hinder or prevent you from qualifying. With that in mind, consider purchasing the highest death benefits possible while you're still young and healthy. Monthly or annual costs end up being much less expensive than they would five, 10, or even 20 years down the road.
If you're finally at the stage where you're getting all your financial ducks in a row, it might be time to start thinking about a life insurance plan. While it's not the most fun thing to consider, it does play a significant role in ensuring your loved ones are protected if something happens to you.
You can get life insurance at almost any age, and the cost of your premiums will be lower the sooner you get it. Whether you opt for a term or whole life insurance policy, AIG Direct is here to help you and your family. Contact AIG Direct today to discuss policy options and get a quote.