Many people view life insurance as a ‘nice to have’ instead of a ‘must have’ and while life insurance is not entirely necessary, there are many benefits to taking out a policy. These benefits are also those that can increase over time, so taking the policy out earlier can certainly pay off. Unfortunately, many people are so unaware of these benefits that they wait to explore their options and in turn miss out as a result. Below are three reasons to consider taking out a life insurance policy well in advance of thinking you need to.
You Will Have Options
There are different types of life insurance, and if you take out a policy early, you lessen the risk of having aged out of, or become too ill for, some of them. The two main types are whole, and term. With whole life insurance, pending the required premiums are always paid, the insured is covered in full for the duration of their natural life. With the term life insurance, it provides coverage at a steady rate of fixed payments for only an established period.
When you take out a policy, it is standard practice to undergo certain physicals and tests to establish the rate of your coverage. By jumping in early, you are assumably in better health, and will receive a more favorable monthly premium. This is also helpful because once preexisting medical conditions have been stated on your record, the insurance companies will use those to raise your payments since you are a higher risk candidate than someone with a better health history.
You Can Cash It In
Using a life insurance policy as a sort of savings account is not at all uncommon. Many people take out a policy and pay month in and month out with the plan to sell it and use those funds for things like long-term health care down the road. You can review a guide that explains the pros and cons of long-term care insurance, for many, affording long term care is not something that can be worked into the household budget on a whim.
You Create Peace of Mind
Nobody loves the discussion surrounding what happens to those we leave behind once we are gone, however having it early, and in advance of necessity is a great way to create peace of mind for yourself, and your family. If you bring children into the world, as they grow into adulthood you are going to want to discuss more exciting things like how to choose a good college, or what social causes they are passionate about. Taking away from those moments with worries about ‘what happens next’ can stunt relationships and in some cases, deteriorate them.
Since the end of life is inevitable, this peace of mind allows everyone involved to acknowledge that fact, but not live inside it day in and day out. Additionally, should a sudden injury or illness occur, you and your family have a portion of the financial aspect of dealing with it already planned out, one less thing to fret over.