Wait . . . You Have Insurance on Your Phone, But Not Your Life?
Our phones are important – we use them for everything from online shopping, to navigating where we need to go, and staying connected to our loved ones. So it only makes sense to make sure they’re protected! So . . . why don’t we treat our lives the same way? Studies show that more than 40% of Americans don’t have life insurance.
Life insurance isn’t as fun to talk about as a new phone, but if you’re serious about protecting your family’s future, you need to make sure you’re covered. One of the most important ways to do that is to get term life insurance.
What Is Term Life Insurance?
Term life insurance the easiest and most affordable type of life insurance you can buy. It’s the only one that Dave Ramsey recommends because, as he puts it, “It’s insurance that does one thing and one thing only: pays the people you choose — your spouse, children, or other beneficiaries — a fixed amount of money if you die.”
According to Dave, term life insurance is a better option than whole life insurance or other types of life insurance you may have heard of, because:
- Term life insurance is cheaper.
- You know exactly what you get with term life — no risky investments.
- Its purpose is simple: to support your loved ones if you pass away.
Term life insurance is a way for you to proactively take care of your family so they aren’t burdened with financial stress when you’re gone.
That might feel weird to think about, but it’s actually a really positive thing. Life insurance provides you with peace of mind, knowing that if something ever happens to you, your family will be completely taken care of. While nothing can replace you, a life insurance policy would replace your income so that money is the last thing anyone has to worry about.
What Kind of Life Insurance Policy Should I Get?
When you get term life insurance, you want a 15–20 year policy in the amount of 10–12 times your annual income.
This is meant to replace your income so that your spouse doesn’t have to worry about mortgage payments or having to make any drastic lifestyle changes when they’re already dealing with incredible loss. If they invest the lump sum it will grow, and they will actually be able to withdraw the amount of your salary each year for a long time.
What if you’re a stay-at-home parent? You still need life insurance because you still bring economic value to your home! Dave’s recommendation for stay-at-home parents is a policy in the range of $250,000 to $400,000.
The truth is that life insurance is the most thoughtful, responsible thing you can do for your loved ones. The best part? You can get it for about what it costs to get insurance on your phone — but the value is exponentially more.
When Is the Right Time to Get Life Insurance?
According to Dave Ramsey, the best time to get life insurance is now. So before you pull out your phone to post another picture of what you made for dinner . . .