How to determine if life insurance is worth it

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Is life insurance worth it? If you have financial dependents it can be.

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Life insurance is often considered a good financial investment for adults of different ages. For one minimum rate to a provider each month, policyholders can gain financial security for their loved ones and potential cash value for themselves while he still lives.

The benefits of life insurance are substantial, especially considering that coverage amounts can be worth hundreds of thousands of dollars or even more than 1 million dollars.

That said, not all investments are created equal. The benefits for one insured may not be as advantageous as for another. Consequently, it helps to do your research to determine if life insurance is really valuable to you and your loved ones.

You can start by getting a free quote online right now so you know exactly what to expect.

How to know life insurance is worth it

As with most personal finance considerations, there is no standard recommendation. The value of life insurance is tied to a variety of factors. However, it is often considered worthwhile if:

You are young and healthy

When it comes to getting the most value for your money, it pays to get a life insurance policy when you’re young and healthy. Life insurance doesn’t get cheaper when you get older; in fact, it only gets more expensive as health problems become more frequent and the possibilities of beneficiaries charge a policy become more realistic. Those risks will be reflected in a higher monthly premium.

But if you are young, healthy and willing to do it do a medical exam to prove it, you can often get a substantial amount of coverage for minimal cost. A term life insurance policy for $1 million, for example, could be provided for less than $100 a month (or maybe even cheaper). In this case, the cost-benefit analysis shows that having life insurance is worth it.

Explore your life insurance options online now.

You have financial dependents

If you’re single and financially independent with no one to rely on, you may be able to skip life insurance or simply rely on life insurance provided by the employer you can already have

However, if you are married with children, or married without children, or have children and are not married, you should have life insurance, and probably in a significant amount. Bottom line: If other people are counting on you financially, you’ll need the protection life insurance offers to ensure that those people will be covered in your absence.

If you can rely on a life insurance policy to pay the utility bills, tuition costs, and food and clothing you currently pay for your dependents, it’s worth it.

You have a mortgage

Home loans traditionally come in 15- and 30-year amounts. Go over the numbers. Will your employer-provided plan be enough to cover what you owe the bank and will owe the bank for years and decades to come? Or are you comfortable with people in your household downsizing to a more affordable alternative in your absence?

If you want to minimize disruption and leave your investment at home so that your beneficiaries earn as much, then a life insurance policy is valuable. Just make sure you get a protection amount commensurate with your outstanding mortgage balance.

Start exploring your options using the table below.

The starting point

The above list is not exhaustive and should not be considered a definitive checklist for when you should or should not purchase life insurance. But, if you fall into one or more of the above categories, you should act now while you can still lock in a low rate.

Start comparing life insurance rates and providers online right now.


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