June marks the start of wedding season.  Along with a lifetime of happiness comes a lifetime of responsibilities.  You promise to love and cherish one another through thick and thin – lean on one another through physical, emotional, and financial hardship.  During the ceremony, you hear the soon-to-be-spouses promise these things “until death do us part”.  But why stop there?

Life insurance is a must-have for married couples and this act of love ensures promises are kept even after “death do us part”.  Here are some reasons why married couples consider buying life insurance:

1. You are blending finances.

As a married couple you are likely sharing responsibility of bills.  The combined income also allows more flexibility for a nicer home or maybe a new car.  One of the main reasons behind buying life insurance is that it replaces income.  If one of you were to die, the life insurance death benefit would ensure you can continue your standard of living.  While you may choose to downsize your home anyway, you wouldn’t be forced to sell it quickly and potentially lose money on it.

2. You may want to start a family.

Sure, if you are both financially independent and well-off, there is a chance you might not need life insurance; however, if you plan on having children life insurance is a no-brainer.  If you are married with no children, and your spouse dies, it would be hard to pick up the financial pieces again without life insurance, but you can do it.  You only need to afford one person.  If you are married with children and your spouse dies with no life insurance… this is a whole different situation.

Your children rely on you for everything.  If your spouse dies unexpectedly, you can’t ask your toddler to get a job and help pay the mortgage so you don’t have to move.  It’s all on you.  With life insurance, if your spouse dies unexpectedly you will still be able to put food on the table, a roof over your child’s head, and afford to send them to college.  Life insurance is lifesaving.

3. The sooner you buy, the cheaper it is.

Ah, young love.  Couples on their wedding day often feel the best they ever have – emotionally and physically.  Did you know that age and health are the top two factors that affect life insurance pricing?  The younger you are, the further you are (statistically) from death which means life insurance carriers don’t see you ask a high risk and let you pay less for coverage.  Ditto with how healthy you are.

Buy life insurance sooner rather than later and lock in low premiums.  In the U.S., the average age when people get married is 29 for men and 27 for women.  Let’s see an example on how much life insurance would cost for the average married couple.

Example:  John and Jane Smith are newlyweds.  John is 29 and Jane is 27 and both are relatively healthy individuals.  They both decide to apply for $250,000 in coverage with 30 year terms.  They want to start a family soon and coverage for 30 years keeps their family financially protected from the unexpected until their children are independent.

John’s premium cost for a 30-year term policy with $250,000 in coverage can be as low as $21 per month.  Jane’s monthly premium cost for a policy with the same features can be as low as $17 per month.

Married couples typically will either name each other beneficiaries of their policies or own coverage on each other.

Option 1: Owning One’s Own Policy Option 2: Owning Policies on Each Other
Policyowner:
John Smith
Policyowner:
Jane Smith
Policyowner:
Jane Smith
Policyowner:
John Smith
Insured:
John Smith
Insured:
Jane Smith
Insured:
John Smith
Insured:
Jane Smith
Beneficiary:
Jane Smith
Beneficiary:
John Smith
Beneficiary:
Jane Smith
Beneficiary:
John Smith

If you are the owner of your own life insurance policy, it will become part of your taxable estate when you die.  If your net worth, including life insurance, is relatively high (in the millions) owning life insurance on each other (option #2 of above chart) is best so it’s not included in your estate.

If your spouse is the beneficiary of your policy, then the proceeds would be protected from federal estate taxes by the marital deduction law.  The marital deduction law allows married couples to transfer an unlimited amount to their spouse without an estate tax hit; however, the surviving spouse does not get this privilege when transferring his/her estate to their beneficiaries, such as children or grandchildren.  Keep in mind each state has different laws regarding estate taxes and the marital deduction law applies to federal estate taxes only.  We will help to ensure your life insurance application is set up properly no matter which state you live in.

Are you getting married soon?  Or maybe you already are married.  It’s time to think about getting life insurance to make sure you and your loved ones are protected from the unexpected.  Get at term life insurance quote today.  Remember when planning your wedding consisted of calling a million different caterers, venues, and flower distributors to find the best price?  Quotacy does all that for you.  We’ll take your application and shop it around to all the different carriers we work with to make sure you get the best policy for your individual situation at a great price.

 

Photo credit to: madebyWstudio

 

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Term Life Insurance for Couples

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