Why You Need Life Insurance and How to Save On it

Sep 28

Why You Need Life Insurance and How to Save On it

If you’re a parent, you look after your kids by feeding, clothing and protecting them. You might not view it as such, but a good life insurance policy forms part of that care. If you worry that you can’t afford one because you’re broke, the good news is that you can prevent wasting money on insurance in similar ways that you cut costs on other bills. Here are some tips to help you get started.

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Get Cover When You Need it

First, what kind of life insurance do you need? Contrary to popular belief, you don’t have to be saddled into a life insurance policy for the rest of your life. You can choose a term life insurance policy that will enable you to specify a certain amount of time in which you want to have cover. A good way to choose the right amount of time is to consider how many years to go until your children will be out of college and supporting themselves. By having cover until then, you ensure a good quality of life for them and an education if something happens to you, without having to break the bank in the meantime.

Get Healthy to Pay Less

You might not realise it but looking after yourself can help to decrease your life insurance expenses! This is because a healthy person is less of a risk to insurance companies than someone who doesn’t look after themselves. It’s all about how likely you are to have to claim from the company. So, maybe now’s the time to quit smoking and get regular exercise, don’t you think? It will save you money and not just when it comes to insurance – you’ll also experience fewer medical bills.

Added to this, if you were paying higher premiums because of a health condition but now it has improved, speak to your insurance company about lowering your premium. Often, insurance companies will reconsider your rate and possibly decrease it but you need to make the first move by asking them!

Don’t Get Comfortable in Monthly Premiums

You might think it’s just easier on your finances to pay your premiums on a monthly or quarterly basis, but be aware that some companies actually charge a higher amount if you are paying your premiums in this way. So, if you can afford it, try to pay once or twice a year because it will save you money later.

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Take Your Time to Get a Good Deal

Although life insurance seems like something you want to get out of the way as soon as possible in favour of doing something more enjoyable with your day, be careful. You don’t want to just jump in as this could be accumulating extra costs. Shop around with your life insurance policy as you would when buying a car – you’re going to be paying it for quite a while so you don’t want to overspend on it.

You can shop around from the comfort of your home by getting estimates of the premiums you’d pay by calling insurance companies. You can also check an online calculator that will help you find out what kind of cost you’re looking at for your specific situation.

Only Pay for What You Really Need

By knowing exactly what you’re paying for, you can save money on your life insurance. The key is to work out what cover you would need should something happen to you. A good idea is to calculate what you not being around would mean for your family financially. This would include them having to pay for your funeral, daily living expenses, school, college as well as perhaps things like your mortgage. Once you’ve got all the costs down, you will have a good idea of what you will require.

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Start Early!

Don’t put a life insurance policy on the backburner or think of it as something you’ll do some day. By getting covered now, you can actually save money. This is because life insurance costs increase as you get older. What you pay when you’re in your 30s and 40s will be less than what you can expect to pay later on in life. Your insurance premium cost will increase by approximately 8 percent for every single year of your age because you’re closer to reaching your life expectancy, so it’s worth your while and wallet to put it on your current to-do list.

Life insurance is a must for every parent, but it doesn’t have to be something too expensive. By following the above money saving tips, you can achieve some savings while protecting your children’s futures.