Selecting Term Life Insurance Time Period

By Randall Rothschild | Life Insurance

Apr 13
Term Life Insurance Time - Quote

#5 of 12 in the Life Insurance “Checklist For The Real World” series.

Since 95% of the people buying life insurance are better off with “term life insurance” we are going to assume you've made the choice to go with term life insurance. Again, if you are one of the 5% who are looking for life insurance plus a tax shelter/investment, speak with your agent/broker about your specific needs. However, this series is still a good read for you to cover your basic understanding of life insurance.

So next you need to select the term length. They come as short as 1 year and as long as 30 years (not withstanding the “Term to 100” products which obviously are a longer term). So there are some questions you need to ask yourself:

  • How long does my family need protection?
  • Why you're buying life insurance? Will that reason be present in 20 years? 30 years? Or maybe it will be gone in 5 years?
  • How much money will your family need if you unexpectedly move on? (that's covered in #6 of the “Checklist For The Real World” series).

Basically buy the term length that will cover the potential time of need. DO NOT buy a shorter term than you need, thinking you can add more later!!! First of all, it costs more later, Second you may NOT qualify later.

As we mentioned earlier in this checklist; The recommend product is the “Term to Age 100®” or “Term to 100®” as it give you coverage until 100 years old, but doesn’t cost nearly as much as permanent life insurance. It's more than 30 year term life insurance, but what if you need insurance on year 31? Yikes.

However, it you're on a tight budget (who isn't) 20-30 year term may be your best bet, because no insurance is even worse!