My Life Insurance Regret

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Life insurance is a necessity if you have anyone at all in your life that you love, especially when they’re in a position where they depend on you. (Think: spouse, children, etc.) Securing a policy when you’re young means being able to name an amount, and as long as you make the monthly premiums, the policy will be active in the event your family ever needs it.

Unfortunately, some of us don’t foresee just how important life insurance is until it’s too late to get the coverage we desire.

Now, with the title of this piece being, “My Life Insurance Regret,” it sounds pretty doom-and-gloom, but let me precursor this by stating that I do have coverage. I had the foresight as a young man to secure a $125,000 policy because it seemed like the grown-up thing to do.

In those days, there wasn’t a wife or child. I did name a niece as my beneficiary at the time, but the truth of the matter was, financially, she would have been just fine had something happened to her uncle. After all, she had her parents. Still, I anticipated getting married and having children one day, and sure enough that day came, albeit about 10 years past due.


Underestimating Coverage

My major life insurance regret comes, not from forgetting to purchase life insurance when it was affordable, but from underestimating the amount of coverage I would need, and then allowing my healthiest years to pass me by without upping the coverage amount. When I was 21, I was able to buy a whole life policy that built cash value for next to nothing. Instead of anticipating what I would eventually need, however, I purchased a policy that seemed like it would be good enough in the short term.

Now at 34, I have a wife, child, anxiety, and cholesterol problems. Walking in to purchase additional coverage resulted in a much higher premium than it did before because I’m older and not as healthy as I was. Grant it, I was still able to get what should be adequate coverage for my family — enough to pay off all of our debts, bury me, and provide a significant cushion, and that does give me some peace of mind — but it comes at a cost that will be felt more significantly on our monthly budget.

While this certainly doesn’t mark the end of the world, it does make me think about missed opportunities. If I’d doubled or tripled my coverage at the initial point of purchase 13 years ago, I would have more cash value, a cheaper policy, and greater peace of mind. What’s worse, is I could have afforded to do just that, but I wasn’t thinking far enough ahead.

Some people — even a lot of experts — advise not buying life insurance until a significant life event triggers the need (think: marriage), but I disagree. Getting the coverage you desire now in anticipation of life events, can mean more money in your pocket thanks to cheaper premiums and higher cash value, and more coverage for your loved ones should the time come that they ever need to use the policy.


In Summary

If you’re healthy enough to get affordable life insurance, then you shouldn’t hesitate. There’s nothing wrong — say, if you’re 21 years old and you don’t have many financial needs — with starting on a smaller policy. But don’t simply buy it and forget about it for 15 years. Take advantage of opportunities every year or two to up coverage limits as your income increases. Don’t wait until you have a potentially serious health issue.

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