This blog was posted on August 26, 2021, by Tom Currey & William A. Rack, Jr. on lifehappens.org. The original blog post can be found here.
Most people would say their family’s financial security is high on their list of priorities. And yet it’s hard to get excited about budgeting for life insurance.
A big part of that hurdle is cost — or, rather, perceived cost. The 2021 Insurance Barometer Study by Life Happens and LIMRA found that more than half of consumers surveyed overestimate the cost of life insurance by 300% or more. Younger Americans are likely to overestimate the cost by as much as six times!
In reality, a healthy 30-year-old can get a $250,000 20-year term life insurance policy for about $13/month. Let’s compare that to the cost of some other common everyday expenses.
The no-shame game
A quick note: the point of this comparison is not to discount the value of our modern era conveniences, or shame anyone for the small pleasures we’ve all turned to (or missed desperately) during the last year and a half. Instead, we’ll show that you can make room for both things — your post-pandemic lifestyle, and the peace of mind life insurance brings — with virtually no sacrifice.
So, what else costs about $13?
- A bottle of wine. We know. The last year and a half has been rough, but just one less bottle of vino per month could make room for the life insurance protection your family needs. In California, the average price of a bottle of mid-premium supermarket wine is $13.29, with a $1-2 variation across the nation.
- A single subscription meal. An average entrée runs $10-15 with most subscription meal services. Dialing it back by just one entrée per month could cover the cost of long-term financial protection for your family.
- Streaming fitness classes. At $12.99/month, exercise fans say it’s worth every penny for access to classes. So why not budget for both? For about the same price, you may also be able to get life insurance coverage as well.
- Your beloved “custom topping” burger meal (and peanuts to tide you over until it’s ready). The average check at your favorite “fast-casual” restaurant runs about $12. If you eat at one of these restaurants a few times a month, just cutting back on one trip gets you pretty close to your life insurance goal.
- A music streaming plan. The family subscription for a music streaming service comes in at about $13 per month, and it’s a cost most of us don’t blink an eye at. While life insurance coverage isn’t quite as “set-and-forget” as being able to download your favorite playlist (don’t skip out on your annual policy review!), it can be just as affordable.
Budgeting for both
Your family’s welfare is always on your mind. Fortunately, making room for life insurance can be easy. You can budget for both, or in many cases, modify a single monthly expense — maybe something you don’t think twice about — and never even feel it.
Consider what’s gained: your peace of mind, knowing your family is protected from financial loss should something happen to you unexpectedly. During a challenging time, they’d be able to continue living in the family home and focus on their needs, without the additional financial stress of your lost income.
That certainty is something that’s difficult to put a dollar value on. But for $13/month, many would call it a steal.
If you’re one of the 40% of Americans with no life insurance, it’s time to get started. Estimate your own life insurance needs now.
Thomas D. “Tom” Currey, CLU, ChFC, LUTCF, a veteran of over 40 years in the financial services industry, is a Past Chair of Life Happens’ Board of Directors and a Past President of NAIFA. William A. Rack, Jr., is Senior VP, Director of Business Development at EveryIncome.