Choosing the Right Term for Life Insurance
I want to buy a term life insurance policy but I’m not sure how long of a "term" to choose for my policy.
If you’re wondering how long you want your term life policy to last, you’ll want to consider a few key things:
First of all, there are usually several durations of term insurance you can choose from when buying a term insurance policy: 5 years, 10 years, 15 years, 20 years, 25 years or 30 years of coverage.
Next, since the longest term of life insurance coverage lasts for a period of thirty years, you’ll need to decide if you really need coverage for a shorter period of time than 30 years, since your needs may change (for example, get longer) as you mature and take on greater financial responsibility.
You’ll want to match your "term" to your specific needs.
For instance, if you want to pay off your home mortgage loan should you die, then select a "term" that is the same as the duration of your loan, for instance, 15, 20 or 30 years.
And, if you want to provide money to pay for your child’s college education you’ll want term insurance until your child would be out of college, for instance, up to age 22.
So, if your child is 7 years old you may want a 15-year term insurance policy.
However, if you think you may have another child in the future, you may want a 25 or 30-year term life plan, just in case.
You can always cancel your life insurance policy when you no longer have a need for the financial protection.
Tips on Buying a Term Life Insurance Policy
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