Life Insurance vs. We’ll Figure It Out

There is never going to be one simple solution for any problem or difficulty we face in life. In the case of insurance, especially for a young couple with children, we feel this is something that is a no-brainer.

Although, yes, it is great for many people to have permanent insurance, especially while you are young and healthy, with low premiums, term insurance is one of the most beneficial types of coverage to own, especially when you have a mortgage and a child.

Why? You are covering pure risk for a specified period of time at a very reasonable premium.

EXAMPLE: Couple, mid-30s who have a child; mortgage – $1,000,000 ; occupation: Working Husband (Making $75-100K/year), Mother on Maternity Leave

If something was to happen to one of them, this would create difficulties. Take into consideration the time to grieve, still manage your day-to-day (especially with a child), organizing the individual’s estate and trying to move on. Then from a financial perspective, you are paying the mortgage, cost of child care, and more.

What does life insurance do for a couple like this? Easy liquidity and easing the financial burden. Now, this in no way means you need to buy a term insurance policy that fully covers your mortgage, or would pay down ALL of your expenses. However, simply getting something helps in a huge way to take some pressure off.

EXAMPLE: Male/Female- each 35 years old (below rates show each individual covered under one policy – total premium)

$250,000 of Term-10 Coverage – $22.05/month

$250,000 of Term-20 Coverage = $31.05/month

In the above example, although, yes, the couple has a $1,000,000 outstanding mortgage, purchasing a $250,000 combined term-10 or term-20 provides a huge financial relief for the surviving spouse at a time of crisis.

Rather than having nothing as a security blanket and feeling pressure to financially sort it out on your own or going to either side of the family for support, this is where true insurance can come in to really help someone. 

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