You’re young, you’re single, and right now, you’re probably a bit worried about the future. Many women decide to start families young, while others decide to focus on their careers. Perhaps your passion is traveling, or maybe you want to just live your life and see what comes around the corner.
Regardless of where you are in life and what your future plans are, you may not have thought about getting life insurance. After all, if you are single, you may not immediately have the need for a life insurance policy the way a married woman with kids and a mortgage might. If this is the case, you may not have realized how single women and life insurance go hand in hand.
Life insurance isn’t just for women with families. Life insurance can be important to get when you’re young and able to snag good premiums. You’ll be surprised by the benefits of looking into life insurance as a career gal on the go.
Here are just a few of the reasons why you may want to take a double look at that term life insurance policy.
How does life insurance work exactly?
Before we delve in too deep, you may be wondering what exactly life insurance is. You probably know of it as an insurance policy that will help cover dependents and spouses if the main breadwinner dies. But did you know that there are two main kinds of life insurance policies?
Whole life insurance is what most people think of when they talk about insurance. It usually has more expensive premiums and lasts, well, for life. It also builds in cash value, making it a powerful investment.
Term life insurance is a more simplified and basic form of insurance. It does not involve investment accounts, policy loan features, or cash values like whole life insurance does.
It also expires at the end of its term, usually a period of time such as 10, 15, 20, 25, or 30 years. If you die during this term, it will pay benefits to your beneficiaries, but if your term ends you will have to renew or risk losing coverage.
Is life insurance different for women?
There used to be quite a coverage gap between men and women, with women over the age of 40 often paying higher premiums than men despite having little or no maternity care. Now, a lot of that has been evened out, and young women especially are seen as less risky investments. This means you can often get a cheaper policy than a man of the same age.
Along with gender, there are a few other factors that can affect your insurance rates, such as:
- Weight and height
- Medical history
- Health habits
- Tobacco or nicotine use
- Current medical conditions
- Dangerous activities
- Driving record
- Family history
To get a good handle on your chances to have a low premium, you should keep up on your recommended health screenings. The more you know about your health, the better you can apply for insurance quotes.
Top Reasons for a Single Woman to Get Life Insurance
At this point, you may better understand why this is a great time of your life for qualifying for low premiums, but you may still be asking yourself, “But why would I need life insurance?”
Life insurance obviously covers dependent care, but it also covers funeral costs, terminal medical expenses, loss of income for the non-dependent family, loan repayment, and even business costs.
In addition, you can take out multiple term life insurance policies on yourself if you need to, so you can have one to cover a loan, one for family or loved ones, and one for your business. This can be especially useful for career-minded women who want to make sure their ducks are in a row.
Cover Outstanding Debts
The first reason you need life insurance is debt. Many people know that a life insurance policy can help pay off a mortgage if you have one.
However, life insurance can help pay for any sort of debt you have incurred, especially those that have a co-signer (such as your parents or a loved one). Federal loans are often discharged if the borrower dies, but private loans may not be forgiven.
If you have private student loans that were taken out in the name of other family members, those loans will often still need to be paid back after you die. Some lending obligations will be forgiven on death, while others will need 100 percent payment back regardless.
Term life insurance can help protect your family members from having to pay back your debts in the case of premature death.
Lock in Those Premiums
Since age is a major factor in qualifying for health insurance, you will often get the best premiums if you get insurance now. It is cheaper to get life insurance when young than when you are old, and if you buy your term life insurance early, you can possibly freeze those rates so you still pay a low premium when you’re older.
This will allow you to essentially pay the same premiums at age 55 that you did at age 25 when you renew your term life insurance. Talk about saving for the future. For this reason alone, getting life insurance now is a major financial boost.
Care for Dependents
Not all dependents are children — if you currently have or will have elderly parents or relatives that may depend on you for support, then life insurance is vital. You may be expecting to outlive elderly or sickly loved ones, but in the event of a disaster, you will want to ensure that they will be taken care of.
In addition, even if you are single, things happen. Maybe you will have a child but won’t have a partner to help take care of them. Or perhaps you will adopt. Regardless of the reason, if there is anyone in your life who will lose support in the event of your death, you may want to consider taking out a policy and knowing who your beneficiary will be is key.
Pay for Your Funeral Costs
Final expenses such as burial and cremation can cost a lot. The average cost of a funeral is $7,000 to $10,000. And if you haven’t set up a will or life insurance policy, these costs will fall on your grieving loved ones to cover.
In addition, life insurance can help cover the cost of emergency and terminal medical care, such as life support and health expenses you incur while staying in a hospital after an accident. If you have to stay in an intensive care unit, your life insurance policy can meet the costs, relieving your loved ones of the burden.
Pass on Your Legacy
If you want to set up a scholarship fund or make sizable contributions to charity, you may want to plan ahead so that you can keep up this legacy or contribution after you die. Life insurance can actually help cover recurring donations or set up a fund post-mortem. In this simple way, you can ensure that your memory lives on, even if you do not.
To make sure your wishes for a legacy or fund are fulfilled, be sure to talk to an end-of-life settlement lawyer and create a will, as well. It may seem morbid, but getting these things taken care of now will only be helpful later.
Protect Your Small Business
If you have a small business, you will likely need to take out small business loans to grow, and these loans usually require you to have life insurance first.
If you have a business partner, you will need to list them as a beneficiary. That way, if you die, it won’t financially disrupt your business or make your partner have to cover the costs completely on their own. You should also create a business plan in the case of your untimely death.
These are just a few of the reasons why a single woman may still want to get a life insurance policy. It turns out that there are still plenty of benefits to staying single