You often hear about how important a Life Insurance policy is, but when is the right time to obtain one? And how much should you get? These questions depend on the person, but there are a few good rules of thumb you can follow to help understand when the right time to invest in Life Insurance is.
How Much Do You Need?
According to Dave Ramsey, you should get coverage that is 10 to 12 times your annual income. This could replace your salary if you were to die, and will give your family a financial cushion to help them get back on their feet.
“The reason we say 15-20 years is simple: if you have young children, by the time the term life policy is over they’ll be out of college and able to support themselves. The only coverage they’ll need is during those 15-20 years in between – when they’re totally dependent on you” says Ramsey.
Six Reasons To Get Life Insurance
- Starting or adding to your family
- Buying a house
- Starting a business
- Supporting aging parents
- Getting married
- Taking out student loans
If there are people in your life who depend on you financially, it’s crucial to have Life Insurance. If you buy Life Insurance at a younger age, you can qualify for lower premiums. As you age, you could develop health problems that make insurance more expensive, which is why we suggest getting a plan in place before any of the six topics above occur in your life.
For more information, or help getting started purchasing Life Insurance, give the Corwin-Rey team a call at 360-414-8754.