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5 Reasons You Should Not Wait Until You Are About To Turn 40 To Buy Life Insurance

40…FOURTY years…4 decades…14600 days…350400 hours…

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It is almost here.  My 40th birthday.  How did this happen? 

I remember getting my driver’s license. I feel like I graduated from high school last year, which is pretty weird seeing as my son just finished his second year at Radford University, but still, that’s what it feels like! 

I remember back when 40 was old. Like ancient old. I’m not old, right?? I still consider myself fairly young. 

Of course, that vision crumbles as soon as I am around people who actually are young and it becomes vividly clear that I am so not! 

I make more noises when I move now. My fellow old people know what I mean by this.  I sit in a chair with a “humph”.  I roll out of bed with an “ugh”.  My body cracks, pops and protests when I try to push it a little farther than I know I should…but I can’t’ NOT push myself. That would be admitting that I can’t do something that could 10-20 years ago.  AND that my friends, is NOT going to happen! 

The reality is…it’s here. The funny thing is that I don’t even mind that I am turning the big 4-0.  What stresses me out, is how unprepared I am for the next 40 years.  I can’t freeze or rewind time.  That stinks because I was not smart enough, or honestly just didn’t care enough, to prepare for my future. I was so busy living life day to day, that ”adulting” was just an afterthought. 

So, sit back, get cozy and listen to the wise teachings from this old owl.  Here are my 5 reasons why life insurance is actually important to plan while you are young (or at least young-ish).

#1- YOU WILL NEVER BE YOUNGER THAN YOU ARE RIGHT NOW

Sounds obvious right?  I mean, it doesn’t take a genius to figure that one out. 

duh

Life insurance rates are based on your age.  The younger you are, the lower the rates.  Get it now while the price is at it’s best!! 

I know you may be thinking, aww now Alice, that’s cute and all to suggest, but I am good for now.  Maybe in a few years when I have my home, career, family, life (insert whatever adult situation applies) in order, THEN maybe I will be ready to talk about life insurance. 

Read the intro again—life is a sneaky snake.  It slithers by so super-fast that you go to sleep 25 and wake up 39 years, 11 months, 2 weeks and 5 days old!  Just call and get a number.  That’s all I am saying.  Get those low rates while you can.

#2- IF YOU HAVE A MORTGAGE, YOU NEED LIFE INSURANCE

Buying a home is exciting!  It’s ridiculously stressful, intimidating, overwhelming and terrifying, but amazing all the same.  (Check out what Agent Tim has to say about buying a home.)

You are making an investment in your future with your new home purchase. Protect it with a term life policy. 

home pic

I recommend buying a policy that is at least the same number of years as the length of your mortgage. So, if you have a 30 year mortgage, get a 30 year term policy. This protects your family.

If you die, and your family is dependent on your income that is no longer coming in, your family will be forced to go through the stress of potentially losing their home as well as dealing with losing you. 

Some lenders do offer added coverage that “forgives” the remaining balance of your loan upon your death.  Why would you go that route?  A term policy is set up for a specific dollar amount for a specific amount of time.  The “forgiveness” amount offered by the lender lowers in benefit based on the amount you owe on your loan. For ease of math for me, let’s say you have a $100,000 home loan.  If you die at year 25 of the loan, you obviously will not have $100,000 balance still remaining.  The bank would “forgive” whatever the remaining balance is at that time.  At least with a $100,000 term life insurance policy, the benefit remains the same throughout the life of the policy.  Your family would get the $100,000 that they can use to pay off the remaining mortgage balance, then have the remaining amount that is left to use towards any other costs and expenses that will arise.

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#3-YOU DON’T HAVE TO HAVE A CRAZY HIGH AMOUNT

Picture it.  The iconic Lifetime movie scene of Jane going to the mailbox to find a $5 million-dollar beneficiary check from the life insurance of her Uncle Bob, whom she didn’t even know existed before that moment. As much as I would love to be Jane (come on secret Uncle Bob…) not many people are going to be Bob. 

Coverage options run wide. They fit your needs and your budget. 

My friend, and fellow agent, Tammy recently told me, “I don’t need enough life insurance to support my husband’s next wife.  Just enough to keep things going while he adjusts financially to me being gone.”  I think that is the perfect theory. 

I recently (as in super recently-like last week kind of recent) took out my own term life policy.  For my amount, I considered what we have remaining on our mortgage, cost of funeral expenses and my salary for a couple of years.  The amount I pay a month is less than I would spend on dinner and a movie.  In exchange for choosing an extra night of leftover spaghetti and watching tv reruns, I have the peace of mind that my husband, my son and we can’t forget my sweet dog Barney, will be taken care of when I am gone. 

barney

#4-THINGS ARE GOING TO HAPPEN

Sometimes life sucks. Bad things happen to good people.  You can put a spin on it and run with the whole “life’s struggles allow you to grow stronger”, but what it also can do is make you ineligible for most life insurance policies.

In October of 2016 my sister Elizabeth (aka Doodlebug) was diagnosed with thyroid cancer.  She told me via a group text with our other sister by the way, but we can save the “Top 5 Reasons Why You Don’t Tell Your Sister You Have Cancer Via Group Text” for another blog. Since then she has had 2 surgeries and is doing well.  We have until October 2021 for her to be officially labeled “cancer free” but for now things look good and she is kicking cancer’s butt. Thank you Jesus.

sisters

She didn’t plan to have cancer.  It wasn’t on her “to-do” list.  It’s not something anyone expects to have to deal with.  She has never had any major underlying health issues.  No warning signs.  No internal cancer clock that gave her a warning that it was near.  I am sure, like with most things in life, there may have been moments that in hindsight that she overlooked.  A pain here and there, a bump or lump that appeared but then went away, a bit of swelling now and again but nothing that really stood out.  We were raised in the days where health care meant rub a little dirt on it and you’ll be fine. I mean if I went to the doctor every time that I had a random twinge, I would stay in the waiting room.   

So now that my sister is beating the big C, she gets to wear that scarlet letter.  Sometimes it’s glowing with pride that she defeated the cancer dragon.  Sometimes it’s with compassion, as she is encouraging others who are going through the same battle.  Then other times that letter costs her, like with life insurance.

She is now ineligible for most typical life insurance policies.  The ones she can get, have rates that are incredibly expensive.  Fortunately for her, she has a life insurance benefit from her employer, but what about a back up plan? What if she changes careers or her benefit packages change?  Cancer wasn’t expected for her.  It isn’t for most people.  Her advice to you, “Listen to my favorite sister Agent Alice, who I love so much more than our other sister Heather, and buy your life insurance now-preferably from her at Holley Insurance.” You should totally listen. She is my wiser (see Bug-I promised I wouldn’t say OLDER) sister!!

5. BUY YOUR KIDS A LIFE INSURANCE POLICY

Just like the above novel that I wrote about my sister, you don’t plan for things to happen to your kids.

When my son was born, instantly I was filled with a momma bear territorial need to protect and love that boy of mine.  The thought of anything happening to him is crippling to me.

(Read how I handled him leaving for college it you want to see the extreme level of my emotions regarding my precious baby boy.) 

I love him more than I love myself, and I love myself a whole dang lot 😊. Buying life insurance for your child is super important.

Of course, life insurance is intended to help with the burden of expenses and lifestyle changes after someone dies.  Let’s not even go there today when talking about buying it for your child. 

Let’s instead focus on why your child needs you to buy this for them now, to help them out in the future.   Many childhood diseases can prevent your child from being eligible for life insurance as an adult. 

According to diabetes.org 193,000 Americans under age 20 are estimated to have diagnosed diabetes.  Curesearch.org states that every DAY, 43 children are diagnosed with cancer! This can often disqualify them for most standard life insurance policies. 

Some policies allow your child the option to purchase more insurance as an adult without proof of insurability. It opens the opportunity for a more affordable option to add the coverage amount they feel they need.

One thing to make super clear though.  Never buy a life insurance policy as an investment.  (Agents everywhere just gasped!)  Even whole life policies that grow cash value are not going to accumulate that much value.  Buy whole life insurance if you are young and can get it at a budget friendly rate.  This way you can lock in that low cost and you have a policy that stays with you for life.  I recommend parents consider the whole life “pay in 20” option for children.  The premiums are set up to be paid off in 20 years so your child is covered for their entire adult life. 

gasp

Do keep in mind.  Life insurance is not simple.  You have term and whole policies, each with a wide range of options for coverage, benefits and payments.  Rates and eligibility vary based on your age, current health and medical history.  There is no “one size fits all” policy.  Take the time to talk to your agent about your needs and budget. Listen to their suggestions and go with the one that is the best fit for your needs.  Then treat yourself to some cake in celebration of my birthday. I’ll be accepting gifts all month long!

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