With term life insurance policies you have the flexibility to choose how long your coverage will last. Here are a few questions to ask yourself as you decide on the best length of time for the needs of you and your family:
Will you be supporting dependents?
As the head of your family, you want to provide for your children and/or aging parents and keep them financially protected, should you no longer be here.
If you have a growing family or young children, a 20- or 30-year term life policy may be the best fit. It could keep your family covered until your kids become financially independent adults. If you’re caring for older children or parents, maybe a 10-year term is what you need.
Do you have a mortgage?
Your home is a major investment. Could your family make monthly mortgage payments – or rent payments – without your income?
With the right amount of life insurance coverage, you may be able to support your dependents and cover housing payments as well. Consider the length of your remaining mortgage. If you still owe payments for the next 20 years, a 20-year term life policy can give you the greater peace of mind that you need.
Do you have other debt?
Car payments, student loans, medical bills, and credit card balances are all common sources of debt other than your mortgage payments. Crunch some numbers, then consider how long it would take your dependents to pay off those debts. As an example, if you’ve still got 10 years left on your student loan, a 10-year term life policy may be a good fit for you.
By taking the time to assess your financial situation, you’ll feel more confident about making the right choice when you buy a term life policy.