When you think of life insurance, you might assume it’s for someone with a family but there are lots of reason to consider life insurance if you’re single, too. For starters, life insurance policies tend to be the cheapest when you are young and healthy! But single people continue to put off life insurance policies until later in life.
Why? More than half of millennials say other financial priorities such as mortgage, bills and debt are keeping them from buying life insurance. Single people are avoiding life insurance not just because it’s complicated, or not because they don’t understand it, but because of some of the reasons below!
1. Paying Bills
Whether you’re single or married with children, paying bills plays a major factor in your overall budget. According to the US Department of Labor, in 2015 the average consumer spent almost $56,000 on expenses like food, housing, utilities, transportation and other services. This equals almost $4,700 a month on bills.
Whether or not you spend that much, it is considered normal for unmarried singles to spend up to and more than 50 percent of their paychecks on monthly bills. This automatically limits the amount you have for insurance, healthcare and an emergency fund. But what if you could have life insurance that doubled as a tool for saving for retirement? The right policy can protect your loved ones in the event of your death and help you prepare for retirement at the same time! Click here to learn more.
2. Paying Off Debt
Debt, debt, debt. No matter what stage you’re at in life, it’s possible that you have some amount of debt that puts further strain on your budget. As a study by NerdWallet put it, “Debt is as American as apple pie.”
Between 2008 and 2014, student loan debt rose 84 percent. The average graduate in 2015 borrowed $28,950 to walk across the stage. In 2016, the average household with credit card debt has balances totaling $16,748. With this hefty financial obligation, it is no surprise that more than 50 percent of Americans say that they have delayed their savings to make payments. And we get it, paying back debt while on a single income can be even harder than having debt with a dual income.
The thing with debt is, it doesn’t always go away if the unexpected happens to you. It’s possible you could leave your parents, an ex-spouse or another loved one to pay off your debts when you’re gone. Having even a small life insurance policy can help ease the burden of expenses for your loves ones.
3. Caring for Family Members
Nearly 16 million single parents live with their children, according to the U.S. Census. Even if you don’t have kids, there may be others who depend on you financially, including elderly parents who need caretaking or special needs siblings. The rising cost of childcare and long-term care may be squeezing your already tight budget.
However, the right life insurance policy can serve as a financial safety net for those you care about most – including those family members.
4. Overestimating the True Cost
Studies have found that one of the top reasons that single people put off buying life insurance is because they overestimate the cost. Would it surprise you to know that a life insurance policy could be less than $1 a day? That is 4.5 times less than an average latte. If you were surprised, you’re not the only one. Eight in 10 Americans overestimate the cost of life insurance and those under 30 tend to overestimate the cost of life insurance by three times! To get an estimate of what your true cost for life insurance is, use this simple life insurance calculator!
2016 Insurance Barometer Study
Still have questions? We’re ready to help. Your local Farm Bureau agent can walk you through the process easily.