Six reasons to get life insurance in your 30s.

Six reasons to get life insurance in your 30s.

As you wave goodbye to the young-and-fun 20s, the taking-life-more-seriously 30s arrive. This is the decade when many young New Zealanders are striving to advance their career, buy property, find their soul mate and start a family. Running in parallel to these life events is a feeling that it might be time to put a financial safety net in place, because there are some risks in play that could upset your future plans.

Here we look at some of the key reasons to get life insurance in your 30s:

Reason #1: You’re still young and healthy.

If you’re a 30-something and don’t have life insurance yet, now could be a good time to get sorted. It could mean you have a greater chance of being covered for health problems you might get in the future. At certain ages, or when you experience certain life events like getting married and having a baby, life insurance provides you with opportunities to increase your level of cover (to a certain level) without the need for additional health information.

 

Reason #2: You’ve found your forever person.

If there’s someone you’re ready to settle down with, you may have big hopes and dreams for your life together. Along with making plans to shape your shared future, it’s important to consider what might happen if life doesn’t go to plan because of sickness, injury or worse. How would one of you cope without the other? Life insurance may help to balance the financial risks that come with injury, sickness or death. Read more about life insurance for couples. 

 

 

Reason #3: Starting a family. 

When you have children, your responsibilities are multiplied and your income needs to support more people than before. Confronting this reality may steer you towards getting some type of life insurance as a financial safety net for you and your family. Depending on the type of cover you choose, life insurance can pay a monthly income for a fixed period of time or a one-off, larger lump sum. The money you receive can be used for anything, like helping to cover household expenses, mortgage payments and taking care of your children’s future needs, if you’re not around. Read more about life insurance for new parents

 

 

Reason #4: You have debts and loans.

Your 30s are often a time for accumulating assets, like vehicles and property. Major purchases often make it necessary to borrow money as a personal loan or mortgage. When you have loans, have you thought about what would happen if prolonged sickness or injury resulted in loss of income? And what if you became permanently disabled or died?

One option for protecting your financial wellbeing is mortgage protection, which can be used to help pay your monthly loan commitments if you can’t work due to ongoing sickness or injury. Life cover could also be appropriate if you share a mortgage with another person or if you have dependents. It pays a lump sum if you die or become terminally ill with less than 12-months to live. Payment of a claim can help towards paying off debts & loans.

 

Reason #5: You don’t have enough savings.

Research shows that 47% of Kiwis between 18 and 64 couldn’t survive more than a month without their income*. Have you ever thought about how you’d get by if you couldn’t work for a few months or more?

If your savings are minimal or non-existent, getting Income protection cover could be an effective financial safety net to consider. With Fidelity Life, up to 75% of your gross annual income can be covered.

Payments start after a wait period that you choose when you arrange cover. It could be 2-weeks to 2-years. You also get to choose how long you’d like payments to continue while a sickness or injury prevents you from working.

 

Reason #6: You’re working for yourself.

If you’re self-employed, either as a company owner or sole trader, you’ll know that your ability to work impacts your financial stability. Part of a business continuity plan often involves getting some form of business life insurance. There are several options in this category, including Business expenses cover, Life cover for business, TPD cover for business and Key person cover. 

 

To design a financial backup plan, talk to a financial adviser.

Before you make any decisions about life insurance, we recommend you talk to a financial adviser. Financial advisers know all about life insurance for people in their 30s and can help you to make practical decisions about types of cover. Find a financial adviser.

 

DISCLAIMER: The information contained in this article is a summary of the key points of the insurance cover(s) mentioned and is general in nature. This article does not constitute a financial advice service. All covers are subject to the definitions, standard exclusions/limitations, terms and conditions contained in the full policy documentation which is available from Fidelity Life or your financial adviser who holds a Distribution Agreement with Fidelity Life. All applications for cover are subject to underwriting criteria.

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*Mindthegap.co.nz – ‘How long could you survive without an income?’ 2015