Buy life insurance when you're young.
Why?
Because it's cheap!
The problem lies in priorities.
When we're young, life insurance isn't something we think about it.
We're more concerned about advancing our careers, increasing our investments, and getting ahead - and rightfully so!
But we can't control what happens to us in life, and the last thing anyone wants is to have all those hard earned dollars put to waste, simply because you didn't consider life insurance.
So why is it a good idea to buy life insurance when you're young?
Why not wait until you're older?
When you're purchasing life insurance, the life insurance company is essentially "making a bet" that you won't pass away (or get sick, if we're talking critical illness) during the lifetime of your policy.
If they lose their bet, they have to pay out a death benefit.
If they win their bet, the policy will mature and the insured will either renew the policy, or buy another insurance product.
Let's compare two scenarios:
A 45 year-old man, non-smoker, buys a $1,000,000 term-20 insurance policy.
A 25 year-old man, non-smoker, buys a $1,000,000 term-20 insurance policy.
The "20" in term-20, means the policy will be in force for 20 years.
Question: Who is more likely to die during in the next 20 years, the 25-year old, or the 45-year old?
That's what insurance company's ask themselves.
Common sense will tell you that it's more likely that the 45-year old will pass away first. He'll be 65, and with age comes more health issues, naturally.
It's more of risk for the insurance company to insure the 45-year old, therefore they quote their premiums at a higher rate than the 25-year old.
This is life insurance in nutshell.
And this is also why you buy life insurance WHEN YOU'RE YOUNG!
Let's compare the pricing for our scenario:
The quoted premium is $610.00/year for the 25 -year old.
The quoted premium is $1600.00/year for the 45-year old.
If you're in your 40s reading this, I'm not trying to discourage you. Some insurance is better than no insurance at all, so it's still a good idea to put something in place if you have nothing.
But if you're in your 20s or 30s reading this, capitalize on your age!
If you'd like to know how much life insurance would cost you, or have any questions in general, complete the 1-minute intake form below and I'll give you a call!
Thanks for reading!
Best,
Dan
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