It’s pretty obvious why someone with a spouse and kids would buy life insurance, but why on earth would a single person need life insurance? You may be surprised. More single people than you think carry life insurance to protect their loved ones and leave behind a legacy.
The bottom line is, when you die, someone still has to pay for a funeral which costs on average between seven and ten thousand dollars when it’s all said and done. Also, sometimes someone is responsible to cover any outstanding mortgage debt, student loans, and credit card debt.
Paying Off Debt
If you had your parents, grandparents, or anyone else help you co-sign on a loan, then that person will be contacted by your creditors to pay any outstanding debts owed.
Rather than burden those who were so willing to help you in a time of need with this debt if you died, your life insurance policy proceeds can be the best way to say thank you in the end by relieving them of any obligation to pay the loans back on their own.
Sarah Johnson is 23 years old and was just accepted to graduate school. To help her qualify for a low interest rate, her mother offered to cosign on her student loans. She takes out $50,000 to pay for her schooling.
If something tragic happens to Sarah and she dies unexpectedly, her mom would be responsible to pay for the full balance of the student loan.
Sarah is young and healthy. She could easily purchase a 15-year $100,000 term life insurance policy for as little as $8 per month and name her mom as the policy’s beneficiary. If Sarah died, her mom could use the $100,000 death benefit to pay for Sarah’s funeral and burial, her student loans, and any other remaining debt she may have had.
One thing that always surprises people is when credit card debt is passed on after someone dies. Credit card companies often try to get you to add joint cardholders and authorized users.
Joint cardholders would be responsible for the credit card balance if the primary cardholder died. Authorized users are not responsible for the credit card balance; however, credit card companies may still contact them and hope that they pay it. If not paid, this balance is likely to negatively affect the authorized user’s credit score.
More single people than you think carry life insurance to protect their loved ones and leave behind a legacy.
Single people are also getting life insurance since more and more adults are taking care of elderly parents or providing housing and assistance for them. Whether it’s to pay off your home that is being shared with your elderly parents, or to provide relocation assistance into an elderly care facility, having life insurance is a great way to ensure your aging parents continue to get the best care possible in a comfortable place rather than being put into a state run facility if you died.
Even pets are prompting single people to get life insurance so that Fido will be taken care of and not shipped off to an animal shelter to spend the rest of their life in a kennel for 12 hours a day, or worse, euthanized.
» Learn more: Pet Trusts and Estate Planning for Your Pets
The moral of the story is that even single people need life insurance in many cases.
Not as much life insurance is needed for single people when compared to someone who has a family or young children that depend on them, but even a small $50,000 life insurance policy is better than leaving those who are close to you with the burden of your final expenses and debts. To see how little it would cost for you to get life insurance, get a free and anonymous term life insurance quote today.
About the writer
Marketing Content Manager and Editor
Natasha is the marketing content manager and editor for Quotacy. She has worked in the life insurance industry since 2010, and making life insurance easier to understand with her writing since 2014. When not at work, she's probably studying and working toward her Chartered Life Underwriter (CLU) designation while throwing a tennis ball for her pitbull mix, Emmett, or curled up on her couch watching Netflix. If it’s football season, the Packers game will be on. Connect with her on LinkedIn.