Term Life Insurance - How Do I Choose the Right Term Length?
So you have decided that a term life insurance policy is the right choice for you. But how do you determine what the best term length is? This is a question I hear many times. It’s a great question and there are a few ways that I look at it. The most common term life insurance policies are 10, 15, 20 and 30 year policies. One way to figure out how many years you should have a term life insurance policy is to consider your financially dependent children. With young children your main concern is that while they are growing up and relying on you financially, you want to make sure the insurance policy covers you until the children are no longer 100 percent dependent on you. Many clients I speak with feel that a good time frame for a term life insurance policy to end is when a child is graduating college. Other people I speak with feel that no matter what, they want the 30 year term period, as this will give them the longest period of term coverage.
If your main reason for getting a term life insurance policy is to cover a mortgage, then you will probably want to look at a 20 or 30 year policy. It really depends on how many years you have left on your mortgage. Many people hope to pay their mortgages off sooner than later. Even if you did pay the mortgage off earlier than the term period, you could still keep the term policy going or decide to cancel it.
Are school loans or loans, in general, your concern? Many clients I speak with are concerned about student loans that they have co-signed. They need to make sure that if a child passes away, they have the ability to pay any outstanding loans or debts. With the cost of education these days, a term life insurance policy is a great way to provide protection for those large dollar amount loans for usually the lowest price.
About the author: Dan Cody has been in the life insurance business for over 7 years. He loves playing a variety of instruments including the guitar, bass, drums, and piano. He also supports cancer research foundations and volunteers at local pet shelters. Dan enjoys helping customers understand life insurance, so they can find a solid policy that fits their needs. You can reach Dan at 1-800-651-1953 or DCody@Pivot.com.