Life is about fulfilling dreams. You may have a new position, gotten married, had a baby or bought a new home. Buying more life insurance is the last thing on your mind. Yet the life insurance you have from your employer or bought years ago may not be enough to protect the life you and your family envision. So how can you purchase more coverage affordably? Here are a few simple tips:
Tip # 1: Buy more coverage when you’re young and healthy
Your income is rising and your family is growing. If something should happen to you down the road, will your family be able to afford their standard of living? Will your children be able to go away to college or pursue a professional degree? By the time you get around to buying more life insurance, it could be too late. And the longer you wait, the more expensive it gets.
When you buy a level premium term life policy now, you can lock in your rate for the life of your policy. For example, if you're a male non-smoker, 37 years of age and in good health, you'll pay about $500 a year for $1,000,000 of coverage for a 20-year term.
Tip #2: Estimate the cost of happy, healthy and secure
As a rule, the guideline for the proper amount of life insurance coverage is approximately five to ten times your annual income. Your policy should take into account basic living expenses — including mortgage or rent payments, credit card bills, groceries, gas and childcare, to name a few. If your spouse does not work and something should happen to you, all the income your family depends on would be gone. That’s why, it’s important to factor in the costs that uniquely reflect your standard of living and family’s future goals.
The cost of a college education may be as much as $60,000.
Home repairs — A new roof, plumbing problems or replacing your air conditioning system add an extra burden to the family budget.
Can you see your child taking piano lessons, going to science camp or studying abroad?
Is a vacation home in your future?
To calculate how much life insurance your family needs, it’s important to estimate the types of expenses you’ll be incurring. Things wear out. If you’re not around, can your family afford to replace the cost of cars, furnishings and electronics over time? And when the time comes, will the cost of celebrating important family events such as a graduation, retirement party or wedding cause them undue stress?
Tip #3: Tweak your budget slightly for peace of mind
Life insurance may be more affordable than you realize. Think about what you’re spending on miscellaneous expenses: entertainment, dining out, electronics, that new espresso machine you’ve had your eye on. For as little as $500 a year (as stated previously), you can protect the people you love and the life you’ve worked hard for.
Tip # 4: Fight inflation by locking in your rate for the entire term
Level premium term life insurance allows you to lock in your rate for the entire term of the policy. During that time, premiums won’t rise with age and the benefit amount remains level. If at the end of the term you select, say 10, 20 or 30 years, you don’t have enough savings to self-insure, we can assist you in getting another policy to fit your needs.
Tip # 5: Before you purchase more life insurance, get multiple quotes
You won’t have to waste time searching the Web to find the best options and rates. TMA Insurance Trust advisors, licensed agents, understand the unique needs of Texas physicians. We gather quotes from multiple, highly-rated insurance companies from A.M. Best, such as Banner, Voya Financial, MetLife and others. And because we don’t work on commission, there’s no financial incentive to sell you more coverage than you need. And, no obligation or sales pressure, ever!
Tip # 6: Update your coverage every few years
Life is constantly changing and thus your life insurance should be reviewed periodically. As you approach retirement, you may not need as much life insurance and could consider adjusting the amount of coverage.
The key to buying life insurance is having the right amount of coverage at the right time. Buying life insurance through the TMA Insurance Trust is one way to protect your family's future, and do it more affordably.
For over 60 years, TMA Insurance Trust advisors have been serving Texas physicians, their families and staff. TMA Insurance Trust prides itself on offering unbiased information and strategies to members, along with exclusive group rates on a range of the highest-rated plans in the industry.
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