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It’s time to get to the bottom of these myths.
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There are certain financial products that tend to be misunderstood, and life insurance is most certainly one of them. If you’ve shied away from looking into life insurance because you believe the following major misconceptions, then it’s important that you get to the bottom of things as soon as possible.
1. It’s prohibitively expensive
Many people assume that life insurance won’t fit into their budgets. But actually, if you stick to a term life insurance policy, you may find that your premium costs don’t break the bank at all.
A healthy 35-year-old male can expect to pay about $30.44 per month for a 20-year, $500,000 term life insurance policy as of February 2023, while a 35-year-old female with the same term length and policy amount can expect to pay $25.66 per month, according to Policygenius. In many cases, that’s less than the cost of buying coffee every day.
One thing you should know is that if you opt for a whole life insurance policy, your costs for that might be prohibitively expensive. That’s because whole life insurance covers you on a permanent basis, whereas term life insurance runs out on you after a period of time. Whole life insurance also accumulates a cash value you can borrow against or even cash out, whereas term life insurance doesn’t.
But for most people, the length of coverage offered by life insurance is more than enough. And while it’s true that your beneficiaries won’t get paid if you make it to the end of your term life coverage without having passed away, well, you’ll have gotten to live. So there’s that.
2. You can’t get insurance if you have pre-existing health issues
Having certain pre-existing health conditions, like diabetes or heart problems, could make it harder to get life insurance. So could certain lifestyle choices, like being a smoker. But that doesn’t mean the option is off the table.
You might need to pay more money for coverage, since your life insurance company might consider you a higher risk. Or, you might need to opt for a no-exam life insurance policy, which can also be more expensive and offer more limited coverage. But don’t assume that life insurance is off the table completely for you.
3. You don’t need life insurance if you don’t have kids
Many people put life insurance in place specifically to protect their children. But it could still pay to get a policy even if you don’t have kids.
Maybe you have a sibling you support financially. If you were to pass away, that sibling might struggle, so it’s easy to make the case for a policy. And if you’re married and have joint expenses with your spouse, getting life insurance could help them better manage the bills upon your passing — even if your spouse has a job.
There’s a lot of incorrect information about life insurance out there. It pays to educate yourself on the ins and outs of life insurance so you’re in a better place to make the right decision for your loved ones.
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