Why Young Families Need Term Life Insurance

Photo by Natalya Zaritskaya on Unsplash

If you have a young family, you probably find yourself financially stressed. Your expenses are rising at the same time that you might be dropping from two incomes to one, even if it’s just for a short time. Money’s tight—but while you’re budgeting for the next few years, don’t forget to include an important financial safeguard for the ones you love: life insurance. While it’s never pleasant to contemplate your own mortality, think of it this way: If you were to die, would your family be able to survive financially?

 

According to Met Life, half of all Millennials (those born between 1977-1992) say they have never been approached by anyone to buy life insurance, and more than 4 in 10 think they wouldn’t qualify anyway. This was two times greater than any other age group.

 

Life insurance doesn’t have to be expensive and complicated. For young families, we usually recommend term life insurance, which is relatively inexpensive and easy to get.

 

What is term life insurance?

Term life insurance provides coverage for a specified length of time, or “term.” The term length can be anything from one year up to 30 years. Currently, the most popular term is 20 years, which is perfect for a young family, most likely protecting you through the years when your children depend upon you the most.

 

Can I afford it?

Term life is actually quite affordable. Usually life insurance premiums are based on age and health, so if you take out a term policy while you’re young and healthy, your rate will be based on those factors for the length of the term. Some policies cost less than $50 a month, a small price to pay for your family’s financial security.

 

How much should I buy?

In addition to covering burial expenses, consider your family’s future needs, including mortgage or rent, and other expenses necessary to maintain their basic standard of living. You may also want to factor in college costs and retirement for the surviving spouse. Use an online calculator like this one to get a basic idea of how much coverage you should buy, and of course, you should discuss your needs with your L & M Insurance Group agent.

 

Remember, it’s not just the breadwinner who needs to be covered. If one parent is a full-time caregiver, consider buying a term life policy for that person, too. The costs of replacing his or her contributions (think child or elder care, housekeeping, and food preparation, for example) would quickly add up.

 

Term insurance is like auto insurance or home insurance in that if you haven’t had a claim during the policy term, you won’t get any of your premiums returned. If you want life insurance to be an investment vehicle, consider purchasing whole life—the downside of this is that it’s more expensive.

 

Term life insurance is cheap, easy to get, and great for young families. Please call your L & M Insurance Group agent at (813) 672-4100 to discuss your life insurance needs. You can also contact us online if you have any questions or you’d like a life insurance quote.

L & M Insurance Group is an Independent Insurance Agency based in Riverview, Florida. We can shop, compare and recommend the home, auto, commercial or life insurance policy that’s best suited for you, your family or your business. Call 813-672-4100 or visit landminsurancegroup.com for more information.

Do an End-of-Year Insurance Review

Insurance review

Now that the holidays are winding down, you may be thinking about your goals and plans for next year. If one of those plans is improving your financial condition, one way you can do this is to conduct a review of your current insurance coverage. Your goal is to have the right amount of coverage for your needs, at the best price.

First, look over your policies to remind yourself of your current coverage and deductibles, insurance premiums, and discounts. Then consider how your life has changed in the past year. Did you get married, divorced, or have a baby? Do any of your children now have driver’s licenses? All these changes should be reflected in your insurance portfolio. Here are a few additional specifics to consider:

Auto Insurance

Is it time to raise your deductible or drop comprehensive and collision coverage? Has your commute changed? Do you have additional drivers in your household who are not listed on your policy? Are you receiving all the discounts, such as safe driver or multi-car, that you’re eligible for?

Homeowners Insurance

If your home were destroyed, would your coverage be adequate to replace it at today’s construction costs? Do you have enough coverage for your personal possessions? You may need to increase your coverage limits if you’ve made improvements to your home, or bought or received as gifts expensive items such as computers, jewelry, or art.

If you’re thinking of raising your deductible as a way to save money on your premium, would you have the resources you need to pay that deductible if you have a claim?

You may be eligible for discounts on your homeowners insurance if your alarm system is monitored. You’ll need to provide a certificate from your monitoring company to receive the discount. If you’ve recently replaced your roof, ask your insurance agent how you can benefit from a wind mitigation report.

Flood Insurance

The entire state of Florida is at risk for flooding. Even if you don’t live in a so-called high-risk area, if you don’t have flood insurance, you might want to consider buying it. We represent several private companies that write flood insurance policies at a competitive rate.

Umbrella Policy

An umbrella policy is additional liability insurance, beyond your home and auto insurance, which protects your assets from a lawsuit. If your assets have increased, you will want to make sure you have enough coverage, or if you don’t currently carry an umbrella policy, you might want to consider purchasing one.

Life Insurance

If you’re the breadwinner, what would happen to your family if you die? A life insurance policy is one way to provide for them after you’re gone. In addition, although life insurance is mainly intended to replace lost income, consider buying life insurance for a non-working spouse or domestic partner. It can quickly become expensive to replace the work he or she does to keep your household running.

Because insurance is an important part of your financial life, it’s good to review your policies from time to time to be sure your coverage remains in line with your assets and liabilities. Remember, if you have any questions about your policies, L & M Insurance Group is here to help.

L & M Insurance Group is an Independent Insurance Agency based in Riverview, Florida. We can shop, compare and recommend the home, auto, commercial or life insurance policy that’s best suited for you, your family or your business. Call 813-672-4100 or visit landminsurancegroup.com for more information.