I’m a 23 year old, non-smoking, healthy male. I’d like to purchase term life insurance so that if anything every happens to me, my Dad(who I’d have as my primary beneficiary) would have enough to pay funeral expenses and have extra money to live on. I’m 23, he’s 54 going on 55 next month. I found a company I’d like to go with, but I was wondering, with my situation, should I go with 20 or 30 year term?
The Insurance would be through HSBC, anyone know if their a good insurance company? They claim to have been rated "A+" by A.M. best.
The Insurance would be through HSBC, anyone know if their a good insurance company? They claim to have been rated "A+" by A.M. best.
fth106 1:06 am on May 17, 2010
At 23 years of age, you are wise beyond your years to be looking at life insurance. Most young people are wanting to spend their hard earned money on things that they think will make them happy. So, congratulations on your mature choice!
Now, if I could go back to 23 and buy life insurance, I wouldn’t even consider term insurance. The cost of a Universal Life policy will be more money but it would provide coverage for the rest of your life, not just the next 20 to 30 years. I know that at 23 you think that 43 or 53 is old, but it isn’t. What are the actual chances of your death happening before you are 53?
Some folks say to purchase term and invest the difference. It has been my experience that, although well intended, most people purchase term and spend the difference. Then when their term policy expires and they still need life insurance, the cost of that UL policy that they could have purchased when they were much younger looks very inexpensive. In addition, the cash value make an attractive addition to your other investments or retirement fund.
I would never present a UL as an investment. It isn’t. But, the difference in cost at your age would be well worth it and I think you will agree with me. If not now, you will 20 to 30 years from now.
mbrcatz17 1:06 am on May 17, 2010
If you’re buying term, buy the longest term you can get – and buy it with a guaranteed renewable and convertable rider. You can always stop paying if you don’t need it any more.