Have you ever thought about buying life insurance, either to protect your loved ones or as an investment strategy? Maybe you already know that a low-cost life insurance policy can benefit you and those you leave behind.
Still, some people may have doubts about the importance of life insurance. These doubts usually result from not knowing enough about life insurance: for example, what it covers, who needs it, and how much it costs.
Here are six common myths about life insurance debunked:
1. Georgia’s Young People Don’t Need Life Insurance
Not true. Your mortality isn’t really something you think about when you’re in your 20s or 30s, so the idea of getting life insurance may be the farthest thing from your mind. However, having life insurance coverage is beneficial for everyone, no matter their age.
Plus, enrolling in a life insurance plan when you’re young can help you lock in lower rates on policy premiums. The older you get, the more expensive your premiums will be if you wait to sign up for life insurance.
2. Single People without Dependents in Georgia Don’t Need Life Insurance
False. Just because you don’t have children doesn’t mean there’s not someone in your life that may be stuck with your bills if something should happen to you. If you bought a house in Georgia and your parents co-signed on the mortgage, they’ll be stuck with the debt if you die.
With a low-cost life insurance policy, you can protect your loved ones from your creditors. You can also have your life insurance benefit a relative, like your sibling, niece, or nephew, or even a nonprofit organization after your death.
3. The Life Insurance You Get Through Your Employer Is Enough
Incorrect. Although many employers provide group life insurance for employees, those policies may not be enough to cover all your expenses after your death. Most employer policies provide coverage equal to one or two times your salary. But if you have a mortgage, college loans, and other debts, you will need more. Experts say you need to be covered for at least 10 times your annual salary to make sure there is enough to cover all your expenses.
4. Life Insurance Is Only for Wealthy People in Georgia
Untrue. Think again if you believe that life insurance is only for the wealthy. Even if you’re a stay-at-home parent who doesn’t earn an income, there will still be costs involved if something should happen to you. If you pass away, your family may need financial support to pay for the things you used to do, such as childcare, cleaning and preparing healthy meals.
5. Life Insurance in Georgia Is Expensive
Faulty. According to the 2021 Life Insurance Barometer Study, Americans’ number one misconception about life insurance is that it’s too expensive. More than half of Americans overestimate the cost of life insurance, especially millennials.
However, the cost of life insurance is within most people’s reach. In Georgia, the average cost for life insurance is about $53 per month. Younger consumers also benefit from lower prices for premiums. For example, the cost of term life insurance for a healthy 30-year-old is about $160 per year.
6. Saving or Investing My Money Is Wiser Than Buying Life Insurance
Misleading. Saving money or investing is always a wise decision, but it shouldn’t be considered an alternative to carrying life insurance. Life insurance is meant to provide financial support for your loved ones if you die. Whole life insurance can also be considered an investment, as you can usually borrow against it in the event of an emergency.
If an unexpected event like a medical emergency drains your savings or the stock market takes a dive, there will be little left for your beneficiaries if you die. On the other hand, the death benefits provided in your life insurance policy are guaranteed funds available for those you leave behind.