Getting married is so exciting! Starting a life with your love is an amazing experience. When you marry someone, your finances become one. Their debts, savings, and investments merge with your own. For this reason, there is a lot of financial planning that goes into a marriage.
As you and your spouse prepare financially for future expenses such as purchasing a home or raising children, it is also important to prepare for unexpected situations in case they do arise. If one of the spouses passes away, a life insurance policy can insure that the living spouse is able to sustain themselves financially without the income of the deceased partner.
Why should you get life insurance?
When you marry someone you vow to love them until death does you part, but even if you were to pass away, you should still want to ensure that your partner has a good life without you. If you are unsure of whether or not you and your spouse should get life insurance, consider the following things.
Without your income would your spouse be able to sustain their lifestyle without your income? Could they even survive without your income? If the answer is no then you need to get a life insurance policy to protect your spouse financially if you were to pass away before they did.
During the devastating event of your death, your family could end up losing more if you do not take steps to protect their financial well-being. It can add to their suffering if their lifestyle, future plans, or living situation has to change during this hard time due to a lack of financial planning.
Couples with children have even more to think about. A life insurance policy can help to ensure that your spouse can still continue to save for your child’s education in the event of something happening to you.
What happens to your debt?
One reason it is important to have life insurance to protect your spouse financially is that when you pass away they could be stuck with all of your debt. If your spouse cosigned on a loan such as a car loan or a home mortgage, they will be liable for paying the debt without your income.
Even if they are not a cosigner, there could be unexpected consequences for the living spouse such as the car being repossessed or a lowered credit score. In some states, in the case of a death the living spouse is liable for paying all debts their spouse accumulated during their marriage.
When should you get life insurance?
The best time to get life insurance is right now. The older you get, the more expensive life insurance can become. For the lowest insurance premiums, apply for life insurance as soon as possible. It may feel like the day when you need life insurance is far away, but the future is unpredictable.
Why should you get life insurance when you’re young?
Life insurance is not something that is only for the middle aged or elderly. Many people get married in their twenties or thirties and they should have life insurance to protect their spouse and families financially in the case of their passing.
Insurance rates tend to go up as we age and health conditions associated with aging arise. When you are young, you will be able to get access to the lowest insurance rates for life insurance policies. If you are currently in good health, then you should go and get life insurance. Our health could potentially take a downturn at any moment, and if a chronic illness arises life insurance prices will go up substantially.
Do one or both partners need life insurance?
In some cases, both partners in a marriage should have life insurance. Many families rely on two incomes and if something were to happen to either parent it would have a financial impact on the family. To determine whether or not you and your partner both need life insurance, take a look at the total debts, savings, and financial responsibilities of both partners.
Partners who do not work may still contribute to the household with childcare, cooking, cleaning, and taking care of the home and without them those services would need to be provided for elsewhere. If the household could not maintain itself without one of the partners, then both spouses need to have life insurance.
If I have savings do I need life insurance?
Some families do not need life insurance because they have enough savings to provide for their family in the event of their death. If you have enough money in the bank to keep your spouse, children, and dependents financially taken care of in your passing then a life insurance policy is unnecessary for you.
What life insurance options are there?
There are several different kinds of life insurance policies for married couples that you could consider. The two most broad categories are joint and individual policies. When deciding which kind of life insurance policy is right for you and your spouse, consider the converge length, the price of the policy, and your purpose for getting the coverage.
Individual life insurance policies
The two most popular types of individual life insurance policies are called term and permanent policies. Term life insurance policies are straightforward to understand. The coverage is provided for a “term”, or a set amount of time. If you pass away during the life insurance term, the insurance company will pay out a sum of money to the beneficiaries to cover their future expenses and the loss of your income.
Permanent insurance is an alternative to term life insurance. Term life insurance means that if you die after the term has ended without renewing the policy, the beneficiaries will receive nothing. Permanent insurance covers you until your death. Permanent insurance can be far more pricey than term life insurance, but has some benefits. You can get a larger death benefit with lower taxes with a permanent or whole life insurance plan.
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