When Should I Buy Life Insurance

How to Know If You Need Life Insurance

Updated March 2, 2020 . AmFam Team

When you’re young, life insurance probably isn’t something you think about every day. But by buying it when you’re younger, you save money on your insurance rates and set your family up for a good financial future.

When you take a big-picture look at your life and the special people around you, it becomes obvious that life insurance is a must-have. Life insurance can be a great way to protect your family’s financial future.

And as your life evolves, your life insurance needs evolve, too. We’ve listed the key life stages when it makes sense to consider your life insurance needs, along with the top reasons why it’s smart to get it.

When You’re Young and Single

When you’re young, on your own and out to conquer the world, life insurance might not seem like a huge priority. Here are a few benefits to picking up a policy when you are young.

Get Lower Insurance Rates

Getting life insurance early in life can be advantageous, since premiums are based in part on your age. The sooner you act, the sooner you could take advantage of a lower rate.

Protect Your Cosigner

If you’ve cosigned with a parent or someone else for things like college or car loans, the cosigner may be on the hook for the whole debt if you were to pass away prematurely.

Don’t Rely on Your Employer’s Life Insurance

If you already have life insurance through your employer’s benefits, that’s great — but it’s not wise to rely solely on your work benefits when it comes to protecting your family’s financial future. Supplementing your work’s life insurance policy with a policy from American Family Insurance Company can give you even more peace of mind.

You’ve Just Gotten Married

Finding someone special to spend your life with and tying the knot is a big milestone, and it’s also a good time to consider life insurance. Here are some reasons why you’re doing your family a major favor when you purchase a life insurance policy after you’ve gotten married.

Help Your Partner

As a couple, you both may be contributing to the household budget. But if one of you passed away, your collective expenses and debts could be too much for your partner to handle. That’s where life insurance comes in — to help financially protect the ones you love.

Practice Good Financial Habits

There’s no better time to start preparing your financial future than when you’ve gotten married. You’ve now got someone else relying on you for financial and emotional support, so start budgeting, planning for children’s education and any other unexpected expenses. Getting a life insurance policy for both you and your spouse can help financially protect both of you.

You’re Starting a Family

When you’ve got little ones depending on you, getting life insurance is a no-brainer. Here’s why:

Save Your Family Some Stress

The day-to-day needs could be difficult for just one person to handle in the event that one of you wasn’t in the picture anymore. From your kids’ daycare to household chores, you or your spouse might need some help. Life insurance can help you pay for things like a nanny, cleaning person or lawn care service.

Protect Your Loved Ones

If you or your spouse were to pass, you might lose one source of income that your family depends on. Having life insurance could help your family settle debts, pay your bills on time and maintain their standard of living.

You’re Entering Your Retirement Years

By now, you’ve probably paid off the mortgage and other debts and fewer people are depending on you financially. You might not think there’s much upside to getting a life insurance policy at this point — but here are some reasons why getting a life insurance policy can still be very beneficial to you and your family.

Needing Your Own Life Insurance Policy

Once you retire, you may lose any life coverage that you had through your employer. Having your own life insurance policy can help loved ones relieve any outstanding debt or final expenses should you pass away.

Needing to Cover Final Expenses

The expensive costs that come with a death can be heavy on family members who didn’t account for them. If you have enough money in your accounts to fund such costs, make sure they’re designated for your final expenses, too. A life insurance policy can help your beneficiaries plan and pay for things like a funeral and other services.

Replace Your Shared Income

After you pass away, a life insurance policy can help replace income from pensions or Social Security that you share with your spouse. Make sure to speak with your family and insurance agent to figure out just how much coverage you need to protect them from financial struggles.

A Change in Employment, Lifestyle and Other Factors

The typical life milestones aren’t the only times when you should consider buying or altering your life insurance policy. If you have a change in your job, a change in your income or legally separate from your spouse, you should consider taking a look at your current life insurance policy with your insurance agent. If you don’t already have a policy, your agent will be more than happy to help you find a plan that fits your new situation.

Life insurance gives you peace of mind and confidence knowing that you’re financially looking out for the ones you love at practically every stage in your journey through life — and your American Family Insurance agent is happy to be there every step of the way to make sure they’re protected.

Life Insurance offered by American Family Life Insurance Company.

Tools & Resources

Explore our tools and smart tips.