Life insurance can be complex — but part of what makes it so are the misconceptions many have, which may be deterring them from enrolling in a life insurance plan (or from taking full advantage of it). The 5 life insurance myths listed are shared by many different age groups and demographics and have persisted for years, pointing to the idea that better financial education is a must for those who want to protect themselves and their loved ones in case of an emergency.
Look through these 5 life insurance myths and, if any of them sound familiar to you, consider learning more about all of the benefits of life insurance—and then explore the best plan for you to get yourself and your family on track to a bright financial future.
1. You can’t afford it. In a recent study from Life Happens and LIMRA, about 80% of those surveyed overestimated how much life insurance actually costs, a trend that was particularly an issue with younger respondents. For instance, while the actual annual cost for a 20-year, $250,000 policy is about $160, millennials guessed $600, and Generation Xers suggested $400.
2. You don’t need it until you’re older. Ideally, you or your family won’t need to tap into your life insurance until you’re older, but it’s most cost-efficient to sign up for a policy at a younger age, as prices can increase with age and the onset of health conditions.
3. Retirement savings is more important. While it is smart to sock money away for retirement, that shouldn’t take precedence over investing in life insurance. Both can be part of a more comprehensive and well-rounded financial plan.
4. Age and health conditions would disqualify you. Both can increase monthly premiums, but you can generally still buy term life insurance, even if you have health complications or are over the age of 60. As long as you don’t have a verified terminal illness, it’s better to sign up for life insurance later than not at all.
5. Employer-sponsored life insurance is sufficient. Insurance offered on a group plan through an employer is sensible, but it shouldn’t be standalone. Most modern employees don’t stay at the same job their whole lives and, if you leave, you can’t take that investment with you, so it’s best to also enroll in your own individual plan.
Life Credit Company is a licensed consumer lender that is dedicated to providing financial assistance for cancer patients and others who are facing serious illness. Contact us online or call us directly at 888-274-1777 to learn about our Living Benefit Loan Program.