When is Life Insurance a Good Investment for You?

life insurance financial planning

Getting life insurance may not be on your radar. According to the most recent Insurance Barometer study conducted by Life Happens and the Life Insurance and Market Research Association (LIMRA), most people (especially millennials aged between 18 and 35 years old) presume the cost of life insurance will be beyond their financial means. As a result, it’s not deemed a priority, especially when the majority of adults already have other financial obligations such as mortgages and student debt.

However, careful planning can help you pick a life insurance policy with affordable monthly payments that will provide you with all the protection you need. The younger you are and the better your health, the cheaper your life insurance will be. With that in mind, the earlier you begin your policy, the better. As your financial circumstances and family life change throughout your life, your life insurance needs will change too so speak with a financial advisor regularly to ensure you’re fully covered

The following four points will help you figure out when the best time is to take out a life insurance policy. (For further reading, we recommend checking out our complete guide to everything you need to know about life insurance.)

You are a Business Owner

Life insurance isn’t just for you and your family. It’s also a financial planning tool for business owners. If you have a company, life insurance can ensure the ongoing survival of your business and save your family from being left with the financial and administrative burden of running it. The policy will help pay off any business debt so that your family won’t need to. In the event of the death of a vitally-important employee, your policy will cover the associated financial losses. Also, if your business is managed by multiple partners, then you can make a buy-sell agreement between them and you, which states that if a partner dies, the remaining partners buy out the surviving family’s share at a previously determined value. The life insurance will then cover this buyout.

Your Estate Has Tax Liabilities

Life insurance can help fund the cost of liabilities (namely taxes) when your estate is transferred to your heirs. It can also be used as an easy-to-access liquid asset to pay any taxes and expenses after your death. This is especially useful if most of your wealth is tied up physical assets, such as properties and other valuables, which are difficult to quickly convert to cash.

You Have a Family

One of the main reasons why people consider getting life insurance is because they want to provide for their family after their death. Life insurance will replace the income you provide that your family may depend on to pay everyday financial obligations, such as living expenses, car payments, and mortgages. You can also use life insurance to cover the costs of your children’s education.

You Have a Step Family

A step-family or ‘blended family’ is one where one or two parents have children from past relationships and have their own family together too. Life insurance can help cover this dynamic network by providing for your new spouse while allowing your children to inherit your assets. Likewise, if you have children from multiple relationships, then your life insurance will ensure that they are all protected equally by your policy.


There is so much information about life insurance out there, but it can be tricky deciding what is the most reliable source and which policy is best to get. Our aim is to empower and support you to make better financial decisions that will help you achieve your objectives. Never hesitate to get in touch with us with your thoughts or any questions – just send us a message! We’re hear to help.


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