Getting Life Insurance in Your 20s

A couple of months ago we increased our life insurance coverage after we finished with buying our home. Since our needs adjusted we decided to shop around and find a deal that would work for us. I’m happy to say we got our coverage and while it didn’t completely as planned, it’s helped us have a financial net for a worst case scenario.

I know life insurance isn’t on many people minds when dealing with debt and trying to start investing, but it’s an important part of your finances. If you’re single and have no dependents, life insurance may not be something that you need. In general, you should consider getting life insurance if you have someone depending on your income, like a spouse or your child(ren).

Factors in Life Insurance

Insurance companies weigh several factors for your life insurance premiums. Some factors you have complete control over, such as occupation and lifestyle, while others are outside your control. They include:

  • Age
  • Gender (women tend to live longer and that’s factored in)
  • Personal and Family Health History
  • Occupation
  • Smoker/Non-Smoker
  • Occupation (some are more hazardous than others)
  • Insurance Coverage and Add-ons

As you can see, purchasing life insurance in your 20s can help you get some of the lowest rates. Depending on your health and lifestyle, you can also qualify for even lower premiums. To confirm you’re in good health, many insurance companies will have a relatively easy medical exam done either at your home or work to get some blood and urine samples.

We had both of ours done at our home after work. It was quick and easy and the nurse was completely professional and friendly. It took an hour for both of and that was due to some small talk.

Deciding on How Much Life Insurance You Need

I’m a fan of MSN’s Life Insurance Needs Estimator to get an amount that would fit for our circumstances. We discussed the results and decided that we wanted to get enough insurance to pay off the townhouse in case one of us dies. We figured having no mortgage and a bit of cash would give the surviving spouse some peace of mind.

How much do YOU need for life insurance? Some experts say you should have 8-10x your annual income. Other say enough to pay off all of your debts and enough to expenses for some years. If you have children, it’ll probably be smarter to get more insurance coverage than if you were married with no kids. If you’re planning on having kids, consider factoring that into your coverage amount.

Life Insurance Companies to Check Out

If you’re looking to shop around for the best deal on your life insurance policy, here are some of the popular companies to check out.

While this is not all of the life insurance companies available to compare, these companies have a reputation of offering competitive rates if you ask around. You might also consider Clarifinancial, which can reduce the amount of phone calls and time spent filling out your information.

What We Got for Our Life Insurance Policies

I have a 30 year $150,000 term life policy from our insurance agent. I qualified for the elite preferred program and I feel comfortable with what I got. My husband has a 20 year term plan for the same amount. While he blood work and urine test came out great, he’s blood pressure readings were a bit off and he was put in the regular category. He has to go to the doctor and get another test done to get a better rate.

We got a small discount on our life insurance premiums by making semi-annual payments instead of monthly payments.If you’re looking for more tips on saving on your life insurance premiums, check out an earlier post I wrote.

Your Advice on Buying Life Insurance

I’d love to hear your tips on getting the best deal on life insurance. If you have life insurance, how much coverage do you have? Do you think that’s enough? How did you determine the amount? What company gave you the best deal?

2 Responses to Getting Life Insurance in Your 20s

  1. We are considering getting life insurance ourselves. For us, it is a little difficult determining how much to get since my husband will be farming and we will be investing a great deal of money in land. We will probably end up getting a pretty large amount of coverage. Life insurance isn’t very fun to think about, but it sure is important!

  2. I am considering this a lot as well, since I am young and have no dependants, and no debt, I am holding off for now.

    If you have 150k 30 year term, I hope your not paying over 30/month for your ‘elite preferred’.

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