Life Insurance for a Term
Term life insurance has always been known as a cheap way to protect your family in the event that you die unexpectedly. It gives your spouse and children basic, no-nonsense coverage so that they can keep living the way you did while you were alive and working. Even though term life insurance isn't too expensive, it's still a good idea to shop around because policies, premiums, and terms vary from one company to the next. Here are some ways to save even more money when you buy term life insurance.
Quotes for Term Life Insurance
As mentioned, it's a good idea to look at more than one carrier to see which one fits your needs and lifestyle the best. For example, some companies charge different prices for an extreme sport that you do a lot of. For example, if you go mountain climbing, one company may charge you more than another for the risk. Either get multiple quotes for term life insurance or have a trusted financial advisor do the legwork for you.
Make sure to ask your financial advisor about discounts on carriers. Some companies offer price breaks if you buy a certain number of face value. If you choose a higher face value, you might end up saving money. If you qualify (policies are also based on your current job), you might only pay a few extra dollars for a $500,000 policy instead of a $250,000 policy. For just a few dollars, doubling your face value would help your survivors a lot if the worst were to happen.
After you get a quote for term life insurance and choose the best policy, make sure to ask about your payment and billing options. Many life insurance companies offer discounts to people who pay their premiums yearly or by electronic funds transfer every month (EFT).
Also, you should look at your term life insurance rates at least once every three years, if not every year. In this fast-paced world, life changes so often that things like getting divorced or having a child will change your financial needs or your desire to cut back. Prices for term life insurance also change every year, so depending on what kind of protection you need, you should give yourself plenty of time to get a new policy so that you don't have two policies that cover the same thing.
Age has an effect.
Even though most people wait to buy insurance until they are financially more stable and have more assets, it is cheaper to buy term life insurance when you are younger. Rates for term life insurance go up as you get older, and your "half birthday" may affect how much you pay for your premium. Most companies that offer term life insurance will raise your rates six months before your birthday. In the insurance business, this is called "the age nearest." Even if the increase seems small to you, maybe just a few dollars, those few dollars add up over time, especially if you buy a 20- or 30-year policy. Also, it's best to buy when you're young because you're probably healthier than people who are older. If you are in good health and your medical tests come back clean, you have a better chance of getting full approval without any restrictions.
Buy term insurance and invest the rest.
You can really save even more on a term life insurance policy if you do a little research. "Buy term and invest the rest" is a well-known piece of advice. You can give your family the financial security they deserve and build a healthy nest egg by putting your savings into something that earns more interest.
