Financial Tips to Do Better

Some things are easy to procrastinate - I can wash those dishes later. Those clothes will fold themselves. I can ignore the light on in my car for another day. Life insurance? I'm young, I don't need that!

Well, it's time to stop putting it off. Getting life insurance early is one of the SMARTEST financial moves you can make.

Life insurance isn't just for families or older adults - it's a smart move for anyone looking to secure their financial future. Whether it's protecting a co-signer on a loan or locking in low rates while you're young, the right coverage can give you peace of mind. Still not convinced? Then, I'm going to break down WHY it matters.

I'd Bet My Life on It

Everyone has someone they love - their parents, children, spouse, or other loved ones. Should something awful happen to you, wouldn’t you want them to be taken care of? Life insurance provides a financial safety net.

Even if you don't have substantial assets yet, life insurance can still be a beneficial addition to your fiscal picture. If you have financial obligations that someone else co-signed, say your parents, on your student loans, they will be on the hook for those payments even if you pass away.

Here are some of the most common reasons for obtaining life insurance:

• Provide financial support for family that can no longer count on your income in the event of a sudden death.
• Cover end-of-life costs – funerals are expensive!
• Provide an inheritance for your beneficiaries and leave your loved ones a financial legacy.
• Give back to important causes by designating your favorite charity as a beneficiary.
• Protect your small business by covering payroll and other expenses should your death disrupt operations.
• Diversify your investments and enhance your retirement plan.
• Cover estate taxes for your heirs.

As you age, premiums continue to rise - so if you lock in life insurance while you're young and healthy, your premiums will likely be at their lowest levels now – allowing you to pay affordable rates for years to come.

Do I REALLY Need Life Insurance?

When you're young, it's easy to think of life insurance as a waste of money, but it can be a massive windfall for your loved ones if anything happens to you.

• Parents: Parents with dependent children have multiple costs to be concerned with, including childcare, school, extracurricular activities, higher education, housing, and necessities. The death of a parent can leave children at a severe economic disadvantage when facing how to pay for these and other future costs.
• Couples: Suppose you share financial obligations with your partner, such as a mortgage or other joint economic ventures. In that case, the passing of one partner can severely impact the financial standing of the surviving other individual. They may be unable to keep up with the same fiscal responsibilities after such a significant loss of income. Having life insurance helps the surviving partner maintain their lifestyle and provides them time to grieve.
• Homeowners: People go their whole lives trying to buy a home, and a mortgage payment likely makes up a considerable portion of the household budget and can become an incredible burden if an income-earning housemate passes away. Life insurance can ensure that your spouse, partner, dependents, or other beneficiaries can keep the home if you are gone.
• Primary Earners: If you're the breadwinner of the family, your loved ones depend on you to survive financially. If something happens to you, they may be unable to support themselves without your contributions to the household. Life insurance ensures that the bills are covered while your beneficiaries take time to adjust.

What's The Life for Me?

There are several life insurance options to fit different financial goals and life stages. Let's try to find the right one for you:

Term Life Insurance

Best for those who need affordable coverage for a set period. It's straightforward and budget-friendly.

• Covers you for a fixed term (usually 5 - 30 years).
• Fixed premiums and a guaranteed death benefit if you pass during the term.
• No cash value - purely for protection.
• If the term expires and you're still alive, coverage ends with no payout.
• Ideal for temporary needs like income protection, mortgage coverage, or family security.
• Provides higher coverage amounts than other life insurance options.

Whole Life Insurance

Provides lifetime coverage with a savings component, making it a long-term financial tool.

• Covers you for your entire life (as long as premiums are paid).
• Builds cash value over time and grows tax deferred.
• You can borrow or withdraw from the cash value - but unpaid loans will reduce the death benefit.
• Higher premiums than term life insurance, but it guarantees a payout.
• It can be sold if you no longer need the policy.

Universal Life Insurance 

A flexible, permanent life insurance option that lets you adjust coverage as your financial situation changes.

• Lifetime coverage with an adjustable death benefit and premium payments.
• Accumulates cash value, which can be used to pay premiums.
• Withdrawals or loans from cash value reduce the death benefit.
• Premiums may be lower than whole life insurance but depend on policy performance.
• Good for those who want flexibility in their financial planning.

Variable Life Insurance

A permanent life insurance option with investment potential - but also risk.

• Includes a cash value component that can be invested in stocks, bonds, or other assets.
• Market performance affects cash value – has potential for growth but also losses.
• Higher risk than whole or universal life due to market fluctuations.
• Often comes with management fees and other investment-related costs.
• Best for those comfortable with investment risk and long-term growth potential.

We're Here to Help!

Life insurance might not be top of mind; however, opening a policy while you're young is a smart move. Lower premiums, financial security, and peace of mind - it all starts now. Whether you're protecting loved ones or planning for the future, locking in coverage early gives you more options and savings. Ready to find the right policy for you? Start with a free quote online today and start protecting the people you love.

If you want to learn more about life insurance options through the credit union or prefer to speak with one of our financial advisors, we're happy to help. Please stop by any of our convenient branch locations or call Atlantic Federal Credit Union Insurance 855-960-4999 to schedule an appointment today.

TLDR:

Securing life insurance early is a wise financial move, offering peace of mind and protection for your loved ones. By obtaining coverage while young and healthy, you benefit from lower premiums, ensuring affordable protection against unexpected expenses like loans, end-of-life costs, and income replacement, guaranteeing financial stability and security.

Stay up to date and join our email list.

The Atlantic Financial Tips to Do Better strives to deliver informative, relevant, and sometimes fun financial information. If you enjoyed this article, please forward it to a friend.

Each individual's financial situation is unique, and readers are encouraged to contact the Credit Union when seeking financial advice on the products and services discussed. This article is for educational purposes only; the authors assume no legal responsibility for the completeness or accuracy of the contents.