The quick answer? It depends.
- Life insurance can protect your loved ones if something happens to you.
- In some cases, you may be better off skipping life insurance and spending your money elsewhere.
- Think about whether someone in your life would struggle without you.
You often hear that life insurance something everyone needs. But there are limited exceptions to that rule. If you don’t have kids and don’t have any debt, you may be better off getting life insurance.
But that is not automatically the case. Finally, there is one question you should ask yourself to determine if life insurance is right for you.
Will the people in my life struggle financially in my absence?
The purpose of life insurance is to protect your loved ones from financial loss in the event of your death. If you can confidently say that no one in your life will struggle financially in your absence, you may be able to pass on getting life insurance. But to be clear, not having debts or children does not automatically mean that life insurance is not needed.
In fact, a big reason many people sign up for life insurance is because they want to make sure their children are well taken care of when they die. And often, people who have a lot of debt with a spouse or partner buy life insurance so that those debts can be paid in their absence. For example, if there are two spouses there is a mortgage loan coupled with needing two incomes to match that mortgage, life insurance becomes a necessity.
But maybe you have no kids, no debt (say, your house is paid off, or you want to rent), and a spouse who is financially independent – they have their own job, high salary, and a lot of money. in savings. In that case, you can choose not to buy life insurance and do other things with your money – like investing. Not necessarily a bad choice.
Look at the big picture
The decision to buy versus liquidate life insurance is a big decision. Before you make that call, do a thorough assessment of your situation to make sure you’re choosing wisely.
Research: Save your life insurance with one of these companies
You may not be married, or your spouse is financially independent, and you do not have children. What if you have a sibling who depends on you for financial help from time to time? In that case, buying a small life insurance policy and naming that sibling as his beneficiary can be a smart move – and it probably won’t cost you much.
Likewise, let’s say you have elderly parents that you are taking care of. You take them to the doctor, do their errands, and make sure their house is taken care of. You may not give them financial aid, but the aid you give them will cost more money to bring out aid. And in that case, buying life insurance and choosing your parents as your joint beneficiary makes sense.
Remember, when it comes to life insurance, the question is whether the people in your life will struggle financially without you. If the answer is yes to any degree, then life insurance is worth getting — even if it’s a small policy with only a minimum benefit.
Our picks for the best life insurance companies
Life insurance is important if you have dependents. We’ve researched the options and developed a list of the best life insurance options. This guide will help you find the best life insurance company and the right type of policy for your needs. Read our free review today.