Reasons Why Singles Need Life Insurance
Life insurance is not only for those who have a spouse or children. Single adults with no children need life insurance also.
There are plenty of reasons single people need life insurance. One of the best reasons are your going to be looking at a much smaller policy. This type of coverage will be inexpensive.
Why should you pay for life insurance coverage if no one depends on you? Here are some reasons to help you think differently:
Some debts, like federal student loans, disappear when you die. The government writes off these loans if they’re unpaid, and no one will need to pay them. If you have private student loans cosigned by your parents, thats a different animal. If something happens while they’re still on the note, they’ll be stuck paying.
Other cosigned debts, like a mortgage, car, or a jointly-owned credit card, any debt with someone else’s name on it will become their responsibility if you died. Plan to have enough life insurance to cover these expenses.
2. Other debts
Debts that you solely are responsible for will be settled out of the proceeds of your estate. Understand this can create tricky situations and can be difficult for the person handling your estate.
Term life insurance is inexpensive, choose coverage that clears all your debts. This puts your family members or friends in position to settle the debts out of the life insurance proceeds. Your estate will be free and clear for them to execute your wishes.
3. Someone else depending on you
Everyone doesn’t have children. But what if there is someone else who depends on you financially? If you’re already planning to help another person financially, make sure you account for that in your insurance policy. Similar to a life insurance for your parents, you’ll need to figure out how much funding you want this person to have and for how many years. Then, add that number on to your life insurance coverage calculation.
4. Business partners
When creating a partnership, always have contractual provisions for keeping the business going if a partner should pass away. In order to make that happen, each partner may need to commit to putting life insurance funds in to keep the business going.
Things can get pretty complicated really quickly.Talk with a financial planner about polilcys when you start a business.
5. Kids at some point
If you’re in you’re early twenties and don’t have kids now, or even if you don’t want them for a few years. Buying life insurance now is a great option. The younger and healthier you are, the cheaper a policy will be.
Think about purchasing a 30-year policy now, when it’s affordable. When you do have children, you’ll already have coverage in place. You may not need full coverage now. But laying down a base coverage lets you purchase it for less. Its always easier to add another policy or increase your coverage when you have children.
6. You live with a significant other
Does someone else depend on you financially to keep a household running? Your life insurance may help them out. Whether you live with a significant other or roommates, this could be the case.
This is not like getting life insurance for a spouse or child. You shouldn’t need to replace your income for your housemate for ten years after you die. You might want to leave them enough to get through the rest of your apartment’s lease before they make new affordable housing arrangements.
7. Family has a history of major health issues
Do your relatives have heart disease, diabetes, or other heritable health conditions? If you have a high probability to be diagnosed with a similar condition in the future, buy life insurance now. While you’re healthy, the insurance will be affordable. If you are diagnosed with one of these conditions, it could get much more expensive.
If you want to have a family someday, cover them with life insurance while you still qualify for affordable coverage.
8. End-of-life expenses
Even if you’re completely on your own, debt-free, and never want a family, you should still consider a small life insurance policy. This is because someone will have to pay your end-of-life and funeral expenses if the worst should happen.
A $10,000 to $50,000 policy is usually more than enough to cover these expenses. This would ensure that your friends and family members don’t have to go into debt to cover these expenses.
You fit somewhere on this list unless you have zero debt or significant savings as a single person. Term life insurance isn’t very expensive, especially if you’re in good health. For a few dollars a month, you can make sure that if the worst happen to you, your family members will be provided for.
Be sure that you set up your life insurance beneficiaries correctly. Make sure that your will and beneficiary lists match and clearly specify what money goes to whom for what purposes.