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Nobody wants to think about their death. But you would want your loved ones to be taken care of when you’re gone. Life insurance can help give you this peace of mind.
However, there are plenty of myths and misconceptions about life insurance that have been floating around since these insurance policies have existed.
So let’s clear up the air.
24/7 Wall St. Insights
- Life insurance provides your beneficiaries with a monetary benefit when you pass away.
- Many people overestimate the cost of life insurance several times over.
- The younger and healthier you are, the cheaper life insurance can be.
- You can also pass on to your loved ones a diversified portfolio powered by dividend-paying stocks. Check out our free report 2 Dividend Legends to Hold on Forever for some insight.
1. Life insurance is too expensive
You can shop around online for affordable life insurance.
Many people are misled when it comes to the overall price of life insurance. In fact, more than half of Americans overestimate the costs of life insurance by as much as three times, according to a recent study by the Life Insurance Marketing and Research Association (LIMRA). And this misconception is especially prevalent among younger generations. Forty-six percent of millennials overestimate it by six times at around $1,000 a year.
But the truth is that the cost of term life insurance for a healthy 30-year-old is about $170 per year. To put this into perspective, the average American spends $1,097 on coffee each year, according to a study by fintech and investing company Acorns.
2. Life insurance is for old people
It may be best to take out life insurance when you're younger.
Contrary to popular belief, it may actually be cheaper and smarter to get life insurance as young as you can.
That’s because life insurance is generally less expensive for younger and healthier people. The older you get, the more at risk you are of developing certain medical conditions. And this could mean higher premiums.
3. You need to be a parent to get life insurance
You don't need kids to get life insurance.
When you take out a life insurance policy, you can declare virtually anyone to be a beneficiary. And it’s easy to change beneficiaries. Moreover, you can even declare a charity or estate as your beneficiary.
4. Stay-at-home parents don’t need life insurance
Stay-at-home parents need life insurance too.
There are many reasons why stay-at-home parents need life insurance. Even though they may not earn a paycheck, the services they provide at home such as raising a child and maintaining the home are essential. If the stay-at-home parent were to die, the working parent may find it difficult to continue working and providing the crucial services the stay-at-home parent did. This is where life insurance could step in.
5. Life insurance is difficult to get
It can be easy to apply for life insurance online.
In today’s automated and digital world, it’s not as difficult to apply for life insurance as you may think. There are plenty of online insurance marketplaces that can provide you with quotes based on your specific needs and circumstances. And much – if not all – of the process can be completed online.
Why we covered this
Life insurance can provide for your loved ones after you're gone.
Life insurance could provide your loved ones with the financial resources they need to provide for themselves after you pass away. But life insurance is a topic that is shrouded in misconception. So we thought we’d debunk some common myths to help you understand the importance of life insurance a bit more clearly.
A Quote in Minutes
Even if you’re in a similar financial position and unsure about the exact amount of coverage needed, it’s always wise to get a quote and explore your options .
A quick, no-obligation quote can provide valuable insight into what’s available and what might best suit your family's needs. With affordable rates and customizable policies, life insurance is a simple step you can take today to help secure peace of mind for your loved ones tomorrow.
Click here to visit our website and learn how to get a quote in just a few minutes.
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