Slicing Through Money's Mysteries
Life insurance used to be cumbersome to research and purchase, but now it’s easier than ever. Not only is there a wealth of information online about life insurance, you can compare free quotes and apply for life insurance policies in minutes right from your couch. So just how much does life insurance cost today anyway?
To find the answer, let’s take a look at what factors impact the price of a life insurance policy. Then we’ll take a look at average price ranges for life insurance by age below.
Roadside assistance is important. Without roadside assistance coverage, you could be stranded in the middle of nowhere for hours!
Every winter, I make the 180 mile trek from San Francisco to Squaw Valley, Lake Tahoe to enjoy the epic snow. There is truly nothing more magical than spending hours riding on powder and having a beer or two in the outdoor hot tub when you’re finished! Oh, the stories I could tell you about what happens in the hot tub.
On the other hand, there’s nothing more frustrating than getting a flat tire at night in the mountains while it’s snowing. I know how to change a tire, but I sure as hell don’t plan to risk my life changing a tire in darkness on a one lane road in the mountains while cars zoom by. I might get a nice settlement if I do get into an accident. But, I also might lose a leg in the process!
Every month, I spend 98 cents to get roadside assistance insurance for Moose. Add up the cost over 84 months of ownership, and we’re talking $83 worth of premiums. And you know what? My roadside assistance insurance is worth every penny! I already mentioned how my alternator died just as I was pulling into my garage thank goodness. A tow truck came when I got back from vacation to follow me to my mechanic thanks to roadside assistance. What I haven’t told you about are my other more traumatic incidences!
How much life insurance do you really need? I’ve wondered this question multiple times through the course of my life. This post will help you answer this exact question.
The key thing to realize is that your life insurance coverage needs change over time. When I was young and single, I didn’t need life insurance beyond my employer provided life insurance equal to 3X my income. But once I had two young children, both my wife and I amped up our coverage.
For years, I had 2X the amount of life insurance coverage as my wife. Once the pandemic hit in early 2020, we realized that not having the same amount of life insurance coverage made no sense.
We were both equal providers and caretakers. Thankfully, my wife as about to double her coverage to match mine for less money using PolicyGenius.
The reason why I have life insurance is because I have mortgage debt and children. I wanted my policy to at least pay off all of my mortgage debt if I were to pass.
The policy is for 10-years and $1 million in coverage. I took it out on my 35th birthday. However, in retrospect, I regret only getting a 10-year term. If I knew I would have kids when I turned 40 and 43, I would have gotten a 30-year term.
Because of a doctor’s visit to treat my snoring, I was diagnosed with sleep apnea. Due to the diagnosis, when I went to see how much more it would cost to renew my term life policy, the premium went up by multiple fold. Not getting longer term was a big mistake.
“Luckily,” what I can do is convert my term life insurance policy to a universal life insurance policy and keep my safe excellent health rating that I had when I was 35. The issue with a universal life insurance policy is that it costs a lot more every month.
At the moment, I’m doing my best to build as much wealth and pay off as much mortgage debt before my policy expires.
To determine how much life insurance you really need, I’ll use my own example from back when I was 35. I’ll also share other examples as well to help you better understand the life insurance process. This post will go over:
Ever since publishing, How To Get Health Care Subsidies Under The Affordable Care Act, I’ve been feeling a little left out. In order to help others get health care subsidies, my family has been paying our full health care costs.
It is an honor to help others, so I don’t mind. However, after not visiting a doctor for five years and paying about $100,000 in health care insurance premiums, I decided to see if I could get my money’s worth.
For three months, I tried to get more health care coverage per month than what I was paying. But I fell short. This failure to get my money’s worth is one of the reasons why I’ve decided to downgrade my plan to Gold from Platinum.
One of the downsides about early retirement is the expensive cost of healthcare in America. Without an employer subsidy, the average cost for a family healthcare insurance plan is about $21,000 in 2020. This post is about how to compare health insurance plans and save money.
The extreme cost of healthcare is one of the main reasons why many employees will work at a job for longer than they really want. If you retire early, unless you earn less than 400% the Federal Poverty Limit (FPL), you will have to pay the full cost of your healthcare premiums. But if you do earn less than 400% of FPL, do you really have enough to retire?
Even if you were eligible for healthcare insurance subsidies, it may feel weird taking advantage of the system. After all, we’ve all been taught it’s always better to give than to receive.
The high cost of healthcare is why you sometimes see one spouse continue to work long after the other spouse has retired. It’s kind of sad that due to expensive healthcare, many couples aren’t able to live their retirement dreams together.
Because I still haven’t been able to convince my wife to go back to work so we can get subsidized healthcare insurance, I’ve asked her to put together some helpful tips on how to compare health insurance plans. We just went through the process and it is quite mind-numbing without a guide.
After successfully doubling my life insurance coverage for less money, Sam and I celebrated over a nice glass of wine. We now have matching life insurance coverage, which we didn’t for the first three years of our son’s life.
Having matching life insurance coverage is logical for us. We just never got around to it until the global pandemic began. If you have different death benefit amounts than your spouse, have a conversation to see if that still makes sense.
Getting life insurance when you only have a mortgage, but no kids is a practical move. However, once you have kids, the value of a life insurance policy may go way up because so much more is at stake.
Once you get life insurance, the next logical question to ask is how long does it take to get a life insurance payout. After all, if you get life insurance and it doesn’t pay out or it takes forever to pay out, that would be problematic.
In this post, we’ll review the following:
Having reliable and sufficient car insurance coverage is so important. But how do you know if you have enough? Car accidents are incredibly expensive today! Here’s how I found that out the hard way.
Several years ago, I did something stupid. Instead of backing straight out of my parking stall, I turned too soon. As a result, I crunched the side of my car Rhino into a pillar. I wasn’t inebriated, tired, or high. I was just in a rush to meet a friend.
The last time I had an accident was in 1998. Instead of backing up into a pillar, I backed into the passenger side door of another car which was also backing out at the same time. It looks like there’s a pattern to my accidents. But who told that Mustang to run into my bumper?!
I remember trading insurance information, paying a $200 deductible, and sending in a sketch of what happened. My insurance company probably paid, but I don’t remember for sure. My premium stayed the same and the cost didn’t stand out.
My wife, Sydney, shares how she was able to double her life insurance death benefit for less money with PolicyGenius. More life insurance for less money is always great. The one thing we’ve all learned during the pandemic is that tomorrow is not guaranteed. If you have debt and/or dependents, getting life insurance is a must.
At my last full-time job of 10 years, one of the free benefits that came with it was life insurance. When I first joined, I was single, didn’t have kids or a lot of debt, and was pretty carefree at age 25.
Life insurance didn’t mean much to me back then. Today, life insurance is very important to us because we now have two kids. Sam has talked about his life insurance plans, but we had seldom discussed mine.
If you’re going to get life insurance as a couple, don’t forget to get life insurance for both people. The amount of life insurance to get will depend on each person’s ability to generate income and cover any outstanding liabilities.
During our expense audit, we meticulously tried to cut costs on every item. What we realized during this exercise was that Sam and I have been spending more than we should on several things for years. One of those things was my life insurance policy.
Given we have been saving at least 50% of our income for over a decade, we got lazy with always trying to optimize our expenses. Laziness is probably one of the number one money-makers for companies today.
Owning the right amount of life insurance is important to protect your family. With the global pandemic raging on, you don’t want to come up short on your life insurance needs.
If you haven’t done so already, calculate your net worth to assess how you did this past year. Hopefully, you’ve grown your net worth in this incredible 10+-year bull market through aggressive savings, retirement company matches, a diversified investment portfolio, rental property cash-flow, and more.
Once you’ve calculated your net worth, make sure your life insurance levels equals this amount, especially if you have dependents, or a spouse who makes much less than you. If you die, and want your loved ones to maintain a similar standard of living, consider matching your life insurance amount with your family’s net worth amount.
Some might not agree with this life insurance guideline and wonder whether it would be better to have insurance that equals a family’s debt level only. Having enough life insurance to pay off all of your family’s debt is better than no life insurance at all.
If you’re single and have no dependents, do you really need life insurance? Probably not, but it’s still not a bad idea. If you die with a million bucks in debt, you’re living large!
As a father of two young children, I often think about the right amount of life insurance to protect my family. Let’s go through an example to see what is the right amount of life insurance to protect different types of families.
To keep your life insurance rate class, one way is to convert term life into a permanent life insurance policy. This post will share when converting a term life policy makes sense and when it may not.
In a previous post, I recommended it would be wise to get a life insurance policy before you see a doctor for any non-life threatening health issue. By locking in a life insurance policy first, you reduce your chances of life insurance companies raising your premiums due to additional health issues on your medical record.
In 2017, I went to see an overzealous sleep doctor. He diagnosed me with snoring, a deviated septum, and sleep apnea. To pad his bill, he also recommended I try a CPAP machine and go through a series of sleep tests. I figured why not since my health insurance would pay for everything. I hadn’t seen a single doctor in years, despite paying over $20,000 a year in premiums.
After I did all the sleep tests, I went to check with my existing life insurance company on renewing my life insurance policy. It was a $1 million, 10-year term policy I took out in 2013. A term life insurance policy is appropriate for most people who want life insurance. Unfortunately, I discovered the renewal premium would jump from $40/month to $450/month!
Part of the increase in premium was because I was four years older and over 40. There seems to be a life insurance premium jump at 40 and 45. But most of the reason for the jump was due to the sleep apnea mark on my medical record.
After the disappointing news, I thought my life insurance options were over once my term policy expires in 2023. Therefore, since hearing about the higher renewal premiums, I made it my mission to boost my wealth by at least $1 million before the $1 million term policy runs out.
As it turns out, I do have a way to continue getting life insurance based on my old “excellent athletic” rating I received in 2013 when I first got my term policy. The official term for the top life insurance rating is called “Preferred Plus” followed by Preferred, Standard Plus, and Standard.
