“I am still young or I don’t have kids, I do not need life insurance.” Some people believe the best time to purchase life insurance is when they are middle-aged, some recommend early, there are mixed answers. When is the best time to purchase life insurance?
Simple answer: The sooner the better.
Why? First, understand the importance of life insurance.
When looking at life insurance coverage from a pure cost perspective, younger age is recommended. At a younger age, you will qualify for lower premiums. And as you get older, you could develop health problems that make insurance more expensive or even disqualify you from purchasing a plan.
To analyze the cost, the average cost of a 25-year level term policy with a $500,000 face amount is about $420 per year for a healthy 30-year-old male. In contrast, the annual premium for a 40-year-old male is about $750. The overall cost of delaying the purchase for 10 years is $3,300.
Additionally, waiting to purchase life insurance can have a greater impact on an attempt to purchase a policy. You are not getting any younger and some medical conditions are more likely to develop as an individual grows older. A serious medical condition can have a significant impact on the premium or chances to get declined.
Since term life insurance premiums don’t go up even if you develop health conditions, it’s usually a good idea to lock in your rate while you’re young and healthy.
Buying life insurance at the right time will help get the right policy for you at a comparatively cheaper price.
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