Differentiating between now and later can be of great assistance when it comes time to purchase life insurance. These terms can also lead one to make some potentially-poor decisions as well. Follow along as we observe more elements of timing in this miniseries on life insurance.
“I’ll Purchase it Later”
Have you taken this approach with life insurance? It can actually work quite well financially in other cases:
- You want to buy a new car. However, given your budget at the moment, it’s not exactly comfortable for you andyour finances. After looking at your budget, you create a goal: put away X amount of money each month in order to build funds to support a car purchase. This will give you a down payment and funds to help with fuel, car insurance, and emergency costs. After all, your current car will last a bit longer – and you could get a used car warranty to protect yourself for the “here and now.”
“If only some people approached their finances in that way,” some of you may be thinking. Indeed, putting off a major purchase can be one of the best ways to take control of your finances. However, it doesn’t exactly fare as well when you speak of insurance – and certainly life insurance.
As we explored earlier, you never know when you will pass away. As MoneySmart explains, imagining how your loved ones will fare is difficult, and certainly talking about dying isn’t easy. However, if you ignore and/or put off such a financial plan of any kind (with or without life insurance), financial disaster could hit your family if such needs are not approached.
Classifying Life Insurance: Now and Later
Now allow us to take a different perspective on timing. With the difficulties of purchasing the right amount of life insurance, you may be wondering how to approach a tough question: “Should I purchase enough life insurance for future financial needs?”
This hypothetical question is an interesting one. After all, if you only need $50,000 in life insurance right now as a single college student, what will you do if you choose to marry and have children? Should you take the full force of the premiums associated with a higher policy? How can you make sense of all of this?
As discussed in other articles on this site, there is nothing against getting more that one life insurance policy. Also, you could consider using term life insurance for the “here” and then approach your “later” needs as they come. You can always “make adjustments as needed” in one way or another, as Laura Coffey points out. There are plenty of options when that time comes.
How will you approach life insurance? Putting it off – or at least any plan for this area of your life/finances – is not perhaps best. You should also not be afraid of future needs at the moment that don’t yet exist. Allow some of these considerations to be involved in how you look at life insurance. Getting quotes to compare life insurance may be one of the biggest steps you can take in making sure your loved ones are taken care of should the unthinkable happen.
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Step 2: After answering a few questions, you will have the opportunity to compare quotes in your area and could be eligible for significant savings.