This post may contain affiliate links. That means if you click and buy, I may receive a small commission. Please read my full disclosure policy for details.
Many women have asked me whether or not life insurance is a good investment. For single women, single mothers, and married women alike, the answer can vary, but it varies very minimally.
It’s a topic we don’t really like to bring up, but it is one of the most important topics around. Oftentimes, we don’t really think about what we are going to leave behind when it is our time to go, but it is essential that we plan for the unspeakable.
With the changes to insurance plans, many more women are being offered life insurance policies. Before you turn it down, it is important to understand how life insurance works and if it is a good investment for you. If you are still unsure about life insurance, check out these four questions to get a better understanding of it.
#1) What Does Life Insurance Do?
Clearly, we understand that life insurance helps our friends and family settle our estates after an unspeakable event. We pay in (usually every pay check), and according to fidelity.com, “In exchange for premiums (payments), the insurance company provides a lump-sum payment, known as a death benefit, to beneficiaries in the event of the insured’s death.”
You choose the beneficiary (or, as recommended, multiple beneficiaries) to help settle your estate. Be sure to let this person know what your final wishes are.
#2) How Old Should You be When You get Life Insurance?
You are never too young to have life insurance. As a matter of fact, the younger you are, the less expensive it is. Through many insurance companies, life insurance for women between 18 and 30 years of age is less than $2 per month for around $200,000 in benefits.
This is enough to help your loved ones fulfill your final wishes and settle your outstanding debts. It will be a difficult time for them; having life insurance will give them added help throughout their mourning period.
#3) How Can Life Insurance Help?
In the untimely event of your death, health insurance will help your family pay off any outstanding debt. This includes mortgages and student loan debts.
According to prudential.com, “An insurance policy’s death benefit can be the difference between staying in the family home, providing for higher education, keeping a treasured family business or not. If you have someone or something that you want to protect, life insurance can help you accomplish that goal, regardless of your current stage in life.”
This is especially important for women with dependents. If you have children, a life insurance policy can ensure that they are able to afford schooling, healthcare, and even a home.
If you do not have any dependents, a life insurance policy can ensure that your final wishes are fulfilled, and that your family and friends have minimal financial responsibilities given the circumstances.
#4) How Much Life Insurance Should You Get?
Ladies, we all know this is a tough subject. Not only is it difficult to prepare for something you’re not sure you should prepare for, but it’s also difficult to prepare your family for it.
When considering how much life insurance you should get, there are several factors to take into consideration. According to bankrate.com, these factors include: “Your age. The ages of your spouse and children. Your income. Your mortgage and other debts. College expenses for your children and/or spouse. The size of the last bill you’ll ever incur: your funeral expenses.”
Don’t think of it as macabre to research the cost of your funeral. It can be much more surprising than you’d think. Depending on your final wishes, it is important to consider that amount of money in your life insurance policy.
Additionally, consider the amount of debt that you have with student loans, your mortgage, any vehicle or large purchase that is financed, and your credit card balances.
At bare minimum, you should cover yourself for your outstanding debt, and your funeral costs.
If you have children, consider adding an additional amount for future college expenses. This can help them ease the pain later. Most companies these days offer your first $10,000-$40,000 in coverage as a part of the insurance policy they offer you. This will help you with premiums (payments) while you are paying in.
Life insurance plans are difficult to talk about. However, this is a topic many women wonder about and should be concerned with. Consider your beneficiaries, your family, and your friends. Your loved ones will be in mourning after the untimely event of your death. Therefore, it is important to ensure that they are taken care of during this time.
Remember, whether you are a single woman with no dependents or married with three children, life insurance plans are not overly expensive, and they are incredibly helpful. What is your experience with life insurance? Share with us in the comments below!