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What Is the Best Age to Invest in Life Insurance Coverage?

Mom with two children sitting on couch

The short answer is…now. The best age to buy life insurance is whatever age you happen to be right now. Ideally, that’s as young as possible, but there are major advantages to investing in coverage at just about any age.

Let’s start by answering a basic question.

Do I Really Need Life Insurance?

Quite likely, you do.

While some forms of life insurance can be an investment instrument while you’re still alive, the major benefits are for your loved ones. If your kids are young, could your spouse raise them without your financial help if anything should happen to you? How about the college years? As a single parent, would your spouse be financially secure?

Even if the kids are grown and living stable lives on their own, your life insurance policy might get the grandkids through college. Or help your children with their retirement plans.

If you’re single, with no spouse and no companion on the horizon, that status could change at any point. In fact, the only reason you might never need life insurance is if you feel no responsibility for the future financial security of anyone, and you don’t expect that to ever change. How sure can you be of that at virtually any age?

What’s the Average Age to Buy Life Insurance?

Most Americans start thinking seriously about life insurance coverage when they’re in their thirties. That’s when many get married, buy homes and start families.

You might start a business in that decade, or you or your spouse could quit a job or go to part-time employment to raise your growing family. This point is when you might start to feel financially vulnerable and wonder what the future might hold for loved ones if you aren’t in it.

Another advantage to investing in life insurance in your thirties (or before) is the cost advantage.

Why You’ll Pay Less the Earlier You Buy Life Insurance Coverage

To your life insurance company, you’re a wager. The bet is that the company will be able to get enough out of you in life insurance premiums before they have to pay out a death benefit. That’s why they want to do business with you when you’re young and, ideally, healthy.

If you’re a thirty-year-old non-smoker, your insurer figures you’re likely to be on their books for quite a while. To put it coldly, your life is a good long-term investment. That’s why you’ll pay less than if you’re decades older.

There’s another way of looking at it. Whatever your age, you’re younger than you’ll be later. So, in all probability, you’ll pay less for your life insurance coverage now than you will in the future, regardless of your current age.

African American couple with young daughter smiling and taking a selfie while buying life insurance

Term or Whole Life?

There are many factors you need to discuss with your trusted agent, and chief among them is the type of coverage that fits your needs best. There are variations, but the two main types of coverage are term life and whole life.

Much as they sound, a term life policy covers you for a period of time. Whole life coverage is also like it sounds. It’s protection for your “whole life.”

Let’s look at both.

·        Term Life Insurance

You buy a term policy for financial security for a specified time period. If you’re a young parent, you might want coverage for the years between now and your kids’ college graduation. So, you take out a twenty-year term life insurance policy. As long as you pay your premiums, you’ll get the protection of a specified death benefit for that window of time.  Once that time is over your policy lapses. But, by then, it’s no longer needed.

A term life policy might also cover the first few shaky years of a new business. Your partners or investors might insist on a ten-year policy to protect their interests in case you die and the business falters.

·        Whole Life Insurance

A whole life policy covers you from the moment of purchase to the end of your life. Since death is inevitable, your life insurance company is guaranteed to grant a death benefit to your beneficiaries.

Your whole life policy might also serve as an investment instrument. Ask your agent for details.

The Cost Difference Between Term Life Insurance and Whole Life Insurance

A term life policy offers full protection over a limited period of time, but that might be when you need such financial security most. If you live through that window, there’s no payout.

A whole life policy, on the other hand, always pays out. Your beneficiaries will receive a settlement at some point, guaranteed.

So, a whole life policy costs more but offers more.

Which is right for you? Ask your life insurance agent.

Find Affordable Life Insurance Online Today

At Freeway Insurance, our independent life insurance agents are here to show you how now is your best age to buy life insurance. Call us at (800) 777-5620 or check for a free online quote for life insurance. You can also find a Freeway office near you.

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