THIRTY SOMETHINGS AND LIFE INSURANCE

Given the weak US Economy, that started in 2007, many younger people have delayed Marriage and Raising a Family. But, obviously, the Biological Clocks are Ticking. So, as the younger generation starts taking on the additional responsibilities of Parenthood, it is important that they provide for lasting security, both for the surviving spouse (if they were to pass on) and any young children.

First and foremost, if your employer does provide Life Insurance–and generally partially subsidizes it–be sure to sign-up for it. But, still get insurance on your own. Remember that, especially given the Current Economy, most Company-Sponsored Insurance is not “transportable”. Transportability means that you can convert it to a personal policy in the event you change jobs or are laid-off. Be sure to ask!

There has been a lot of erroneous nonsense, touted on the right, that young people shouldn’t have to buy Health Insurance. Insurance, of any type, is best purchased when you are young and can qualify. Also, for Life, the cost might be lower. Generally, Renewable Term Life is the most affordable. The additional cost of, let’s say, Whole Life merely pays for commissions and builds a small Cash Component that normally has a very low rate of return, Compare.

I would suggest buying as much life insurance as you can conveniently afford. Five years of income, if possible. Also, if you are fortunate enough to have a stay-at-home parent, at least in the early years, have life insurance for that person, as well. Remember that the additional expenses for a surviving spouse would increase–especially for Day Cary and Baby Sitters. It’s best to plan ahead.

Lastly, insurance purchased through a “mutual company” is often more affordable. Mutual companies do not have shareholders and thus–there’s not a profit motive. The Policy Holders actually own the company. That means that you might get a “dividend”:, every so often, which is a refund of excess profits–and might be tax-free.

Remember, that any type of insurance will hopefully be the worst investment that you can make. Think about that!

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