Death can be tough to ponder, let alone plan for. So it should come as no surprise that although most Americans acknowledge that life insurance is a necessity, only about 60 percent actually have it.
It’s myths like these that hold people back from such protection — but, we promise, the truth behind life insurance actually makes thinking about its purpose a little bit easier.
Myth No. 1: It’s too expensive.
Many people cite cost as a major reason they haven’t purchased life insurance. But the 2016 Insurance Barometer Study found people tend to overestimate the price by more than twice the actual cost. If the cost of life insurance has been something on your radar as a point of concern, consider a term life insurance policy. It’s generally less expensive than other types of coverage, and you’ll have opportunities later on in life to update your level of protection.
Myth No. 2: I’m young and healthy, so I don’t need to worry about it yet.
Actually, you need life insurance at every stage in life. And you actually might benefit from learning about its living benefits. Whole and universal life policies not only provide a death benefit, they also allow you to use accumulated cash value for plans such as buying a home or retirement. There are tax advantages, too. Looking for an immediate bonus? You can get better rates at a younger age.
Myth No. 3: I’m single without kids, so I don’t need it.
It’s easy to think this way if no one depends on you financially. But consider any substantial debt you wouldn’t want to pass on to surviving family members if you were to die prematurely — not to mention funeral costs, which were as high as $8,500 in 2014 (and that’s not including flower, monument or obituary expenses). That’s a lot of cash for your loved ones to drum up during their time of grief.
Myth No. 4: The breadwinner in my family already has a policy, and we don’t need two.
Your family relies on your contributions, too — financial or otherwise. Even if you are a stay-at-home parent, having life insurance is a smart choice. Child care, cooking, housecleaning and household management all contribute to your family’s quality of life, and that can be costly to replace for a surviving spouse.
Myth No. 5: My employer gives me all the life insurance I need.
Many employers provide a basic life insurance benefit, often equal to one to two times your base salary. That’s certainly a great benefit to have, but most people really need somewhere between 10 to 20 times their net income and sometimes even more than that, according to Life Happens. Consider purchasing additional coverage on your own.
The amount of life insurance you need depends on your particular situation, but according to our 2017 Confidence Pulse Poll, only half of Americans who have life insurance are completely secure in the amount they have. Use our simple life insurance calculator to find out how much protection you might truly need. Then, connect with a Farm Bureau agent to find the coverage that’s right for you.