Protecting Your Earning Power at Every Stage of Life
by Ande Frazier
June 3, 2019 .4 min read
As we get older, get married, build families, and start businesses, the need for insurance becomes more and more apparent. It's usually during these major life moments that we feel the need to obtain coverage because of the vital role it plays when creating a financially sound plan for you and your loved ones.
But truth be told, insurance isn't something you just get when you have a family or feel like you have assets finally worth protecting. In fact, having insurance is crucial in all stages of life. Here are some examples of how and why:
When You’re Single
(Even single people need some type of coverage.)
Most single people fail to realize how important it is to have life insurance even when single. Why? Because they think there isn't a real need. But that's not necessarily true.
Have you ever thought about if you died, who would pay for your funeral?
Even a simple ceremony can cost a pretty penny. And if you don't have life insurance, someone else (e.g., your family) may have to foot these bills. Considering even a small policy would be helpful as the death benefits could be used to cover some if not all expenses.
Aside from covering funeral costs coverage is also important to consider if you fall under one of these circumstances:
You provide financial support for aging parents or siblings. Whether you have aging parents or maybe a sibling with special needs, that depends on your care and financial assistance, you need to think about what would happen to them if something happened to you and your support came to a sudden stop. That's where life insurance can ensure your support goes on undisrupted.
You have student loan debt. Many people assume that if you die, your debt dies with you. Unfortunately, that's not always the case. While the loans through the federal government are typically forgiven, personal loans that require a cosigner are generally not. What that means is if your parents, for example, co-signed on your student loan through a bank, if something happened to you, they would inevitably become responsible for paying the rest of the loan off.
When You’re Married or Getting Married
(But you probably already knew that.)
So, here is probably where most would think obtaining life insurance is worth getting. And you're absolutely right. If you're married or getting married, you should definitely consider insurance. After all, a secure financial future together starts off with a strong foundation.
To create that foundation, it's best to start with life insurance as it's an affordable way of creating security for you and your family.
When starting a policy, naming each other as the beneficiary is essential, so if one were to die, the other can still have financial support via the life insurance payout.
That payout becomes especially important when debt becomes a part of the conversation. Ever hear of the saying,
What’s yours is mine
Well, that saying has never been true when it comes to married couples and debt. Life insurance helps create ease on such a nervy topic and allows you to be mindful of whether your spouse would have enough money to cover your funeral costs, credit card debts, outstanding loans, as well as their daily living expenses if you were to pass.
When You Have Children
(This isn't news to you.)
Having a child can be very rewarding but also expensive.
Life insurance helps to ensure that your family can maintain their current lifestyle and can even help fund longer-range needs, like college tuition and retirement.
And for parents who don’t work outside the home, obtaining life insurance is just as crucial for you. Why? Because the services you provide are not only vital for the family but can be costly. Think about some of those services you provide daily that probably go unnoticed, like childcare, transportation, and household chores. Now think about if these services were now allocated outside of the family, these services don't come cheap.
And what about single parents? Life insurance for you guys is especially crucial because your children rely on you for everything.
When You're Ready to Retire or Already Retired.
(Yes, you still need life insurance even if your children are financially on their own.)
If your children are on their own and your mortgage is paid off, you might feel that your need for life insurance has passed. Right?
But if you died today, your spouse could outlive you by 10, 20, or even 30 years. Will they have enough funds to support them even after you're gone?
Many retirees also still have financial obligations such as the mortgage on a second home and can become burdensome if a spouse dies or becomes disabled.
Life insurance helps to ensure that:
Your spouse is protected
Your estate will be passed on, intact, to your survivors
A legacy can be provided to your children and grandchildren, even if you use up most of your assets during your lifetime
For all of these reasons, if you’ve been thinking about dropping your coverage, you may want to reconsider. In fact, Americans age 60 and older are the fastest growing market for life insurance purchases.
In short, life insurance is a simple answer to a challenging question:
How will my family manage financially when I die?
It’s a subject no one wants to think about, but if someone depends on you financially, it’s one you should not avoid.
Other Types of Insurance
Other types of insurance are a must as well, no matter what stage you are at in life:
Home insurance, if you own a home
Renter’s insurance, if you are currently a tenant in a rental property
Insurance isn't something you just get when you have a family or feel like you have assets finally worth protecting. In fact, you should consider having coverage at all stages of life. Allow your insurance to create a solid financial foundation while also having peace of mind knowing everyone you love is protected. For more information, contact myWorth here.
Ande has made it her mission to break down the emotional, behavioral and societal barriers that stand between women and strong financial foundations.
She's widely recognized as a driving force in the financial community, having risen to the top of the primarily male-dominated insurance world as the former head of a multi-million-dollar fintech company and a VP at Penn Mutual.
Ande launched myWorth to inspire a financial awakening among women who are eager to take control of their financial journeys. Her first book will be published in October 2019.