It's time to debunk some of the most common life insurance myths.
A good myth is a good story. Ancient Greek tales of Odysseus live on through songs, books, and movies. Some myths, like the story of Pandora's Box, make their way into the everyday lexicon. Other myths inspire magical childhood moments (the tooth fairy, for instance). And some myths turn out to be real. (Marine biologists believe the fearsome, ship-wrecking Kraken was actually a giant squid.)
Other myths, however, do more harm than good. Life insurance myths fall into that category. Skipping out on life insurance because of a myth only serves to hurt you in the long run. Here are some of the most common life insurance myths and reasons to disregard them.
5 Common Life Insurance Myths
1. I'm too young to worry about life insurance.
The benefits of life insurance aren't paid out until after your death, so it's natural to believe that you won't need life insurance until much later in life. However, your insurance premiums are less expensive when you are younger. Additionally, even though we hope this isn't the case, accidents do happen, and life insurance will help your family cover funeral expenses. Many families have to make the hard decision to have a cremation without services when an unexpected death occurs and they're not prepared for the cost of funeral expenses.
2. Life insurance is too expensive.
The truth is life insurance is probably less expensive than you think. Rates vary quite a bit and depend on any number of qualifiers, such as whether or not you smoke, your general health, and your family health history. One major factor in your premium rate is your age, as noted above. However, a healthy middle-aged adult can get life insurance for about the cost of takeout from your favorite pizza shop.
Just as an example, the average premium for a 50-year-old healthy person with a 20-year, $200,000 policy is somewhere around $65 per month. A similar policy for a 20-year-old could be under $20 monthly.
3. Choosing life insurance is too complicated.
This is one of those life insurance myths that may have some truth to it, BUT it's no more difficult than choosing the right dentist or the right summer camp for your kids.
The right life insurance policy is one that meets your individual needs. If you have young children, you could buy term life insurance to help cover their care in case something happens to you. Whole life might be a better option if you want additional benefits that term life insurance doesn't offer, such as guaranteed premiums and cash value.
Your best bet is to talk to your local Pekin Insurance agent to find out what your options are and what's best for you. You do have multiple options, but there are some pretty noteworthy differences in the types of life insurance that will help you quickly narrow down your decision.
4. I'm single. I don't need life insurance.
This myth stems from the fact that life insurance, to many people, is to give financial security to loved ones after our death. Even if you don't have anyone you want to list as a beneficiary on your policy, there are benefits from a whole life policy that you can access while you are still alive.
You can take out a loan against your policy, tax-free in some cases. A whole life policy may pay dividends. Or you can use the cash value of your policy to help cover certain life expenses.
5. I'm too old to buy life insurance.
It is true that the older you are, the more expensive a life insurance policy is. In many cases, though, you can get life insurance up to age 80.
Why would you get life insurance when you're 60, 70, or 80 years old? Your policy benefits can cover the cost of a funeral and burial. Additional benefits might help loved ones, such as a spouse or child, through financial difficulties. Some people hope to leave a legacy with their benefits going into a scholarship or to their favorite organization. In other words, there are as many personal reasons to get life insurance as you can imagine.
When it comes to life insurance myths, or any insurance myths for that matter, it behooves you to look into the facts. You may be surprised at what you find.
When you have questions about life insurance, your local Pekin Insurance agent is ready to answer them. Contact your agent today and find out how we can help you.
What life insurance myths have you discovered aren't true? Share your stories in the comments.