Paying My Life Insurance

Good news, bad news.

The good news is that I am alive to pay my life insurance. The bad news is that the premium is going up.

About twenty-five years ago, I took out a life insurance policy. I bought term insurance – a great deal of term insurance. Now I’m still buying term insurance and the premium is going up. Oh well. I’m still not a fan of whole life and universal life for most people. Buy term, and a lot of it.

My understanding is that fewer and fewer Americans are buying life insurance outside of what they get from their employers. That’s a bad thing.

How much life insurance should you buy? For most people under fifty, the rule of thumb is five to seven times your annual income. If someone depends on your income, you need to have life insurance.

Babies don’t need life insurance.
College students don’t need life insurance.
Couples starting out don’t need life insurance.

Families with a single income need life insurance on the earner.

Families with children need life insurance on all the earners.

Families with multiple generations dependent upon an earner need life insurance.

Disability insurance, too.