What Age Should You Get Life Insurance?

Life insurance ensures your loved ones are taken care of if you’re no longer here. It can cover debts, daily expenses, or even future goals like college tuition. But when’s the right time to get it? Is there a perfect age?

The answer depends on your unique situation. Your age, financial responsibilities, and who depends on you all play a role. Generally, starting early in your 20s or 30s—offers big advantages. In this article, we’ll explore why age matters, how your needs change over time, and why getting life insurance sooner rather than later is often a smart choice.

Why Age Matters in Life Insurance

Age is a key factor in determining life insurance costs. Insurance companies use your age to assess risk. Younger people are less likely to pass away soon, so they’re considered lower risk. This translates to lower premiums. As you age, the risk of needing a payout increases, so premiums go up.

Here’s a clear example of how age impacts costs, based on data for a 10-year term life insurance policy with $125,000 coverage (Bankrate):

For whole life insurance with $55,000 coverage, the difference is even starker:

These numbers show that starting early can save you hundreds of dollars monthly. Plus, younger people are often healthier, which further lowers rates. Waiting too long can mean paying much more or even being denied coverage if health issues arise.

Life Insurance Needs at Different Ages

Your need for life insurance changes as you move through life. Let’s break it down by age group to see how your priorities might shift.

In Your 20s: Building a Foundation

In your 20s, you’re likely starting your career. You might have student loans, a car payment, or be thinking about buying a home. Even if you don’t have a family yet, life insurance can be a smart move. It can cover debts so co-signers, like your parents, aren’t left responsible if something happens to you.

For example, imagine you’re 25 with $30,000 in student loans that your parents co-signed. A term life policy could ensure they’re not stuck with that debt. Plus, starting now means you lock in low rates while you’re young and healthy. 

In Your 30s: Growing Responsibilities

Your 30s often bring big life changes—marriage, kids, or buying a house. Your financial responsibilities grow, and so does your need for life insurance. You’ll want to protect your spouse and children, ensuring they can maintain their lifestyle, pay the mortgage, or cover childcare costs if you’re gone.

For instance, if you’re 32, married with a 2-year-old, and have a $200,000 mortgage, a life insurance policy could cover the mortgage and provide funds for your child’s education. Term life is often a good fit here because it’s affordable and can cover you until your kids are grown or your mortgage is paid off.

In Your 40s and 50s: Peak Earnings and Family Costs

By your 40s and 50s, you might be at the peak of your career with a higher income. Your kids could be in college or preparing to leave home, which brings new expenses. You may also be supporting aging parents. This is a time to reassess your coverage to ensure it matches your income and family needs.

For example, at 45, with two teenagers and a higher salary, you might need a policy that covers college tuition and supports your spouse. A mix of term life (for temporary needs like tuition) and whole life (for long-term planning) could work well. It’s also a good time to review your existing policy to make sure it’s still enough.

In Your 60s and Beyond: Legacy and Final Expenses

In your 60s and beyond, your focus might shift to retirement, leaving a legacy, or covering final expenses. Life insurance can help pay for funeral costs, which can be significant, or provide an inheritance for your grandchildren. It’s also useful for estate planning, helping to cover taxes or provide liquidity for your heirs.

For example, if you’re 65 and retired, a whole life policy could cover funeral expenses and leave a tax-free inheritance. There are also policies designed for seniors, like simplified issues or guaranteed issues, that don’t require a medical exam, making it easier to get coverage.

Types of Life Insurance Policies

Choosing the right life insurance policy depends on your age, budget, and goals. Here are the main types:

Term Life Insurance

• What It Is: Covers you for a set period, like 10, 20, or 30 years.
• Best For: Temporary needs, such as a mortgage or until your kids are independent.
• Pros: Affordable, flexible terms, straightforward.
• Cons: No cash value; coverage ends when the term does.

Whole Life Insurance

• What It Is: Provides coverage for your entire life, as long as premiums are paid.
• Best For: Long-term protection and building cash value.
• Pros: Lifetime coverage, builds cash value you can borrow against.
• Cons: More expensive, less flexible premiums.

Other Types

• Decreasing Term: Coverage decreases over time, often used for mortgages.
• Joint Life: Covers two people, like spouses, but ends after one payout.
• Critical Illness Cover: Combines life insurance with payouts for serious illnesses.
• Over-50s Plans: Designed for older adults, often with no medical exam, available up to age 90.

Younger people often choose term life for its affordability, while older adults might prefer whole life for lifelong protection.

Benefits of Getting Life Insurance Early

Starting life insurance early has several advantages:

1. Lower Premiums: Younger people pay less because they’re less risky to insure. For example, a 25-year-old pays far less than a 40-year-old for the same coverage.
2. Lock in Rates While Healthy: Health issues can make it hard or costly to get coverage later. Buying early secures your rates.
3. Build Cash Value: For whole life policies, starting early gives the cash value more time to grow, which can be used for retirement or other goals.
4. Peace of Mind: Knowing your family is protected, no matter what, is invaluable.

For example, a whole life policy started at 25 could have significant cash value by 65, which you could use to supplement retirement or pass on to heirs. A term policy at 25 can cover you until 55, when your kids are likely independent.

Considerations for Getting Life Insurance Later in Life

It’s never too late to get life insurance, but there are challenges:

• Higher Premiums: Premiums increase with age, sometimes significantly.
• Health Issues: Pre-existing conditions can lead to higher rates or denial of coverage.
• Limited Options: Seniors may qualify for simplified issue (no medical exam) or guaranteed issue policies, but these often have lower coverage limits (e.g., $25,000–$50,000) and higher costs.

For example, a 70-year-old might get a simplified issue policy with $50,000 coverage, but premiums could be steep, and the payout might be limited in the first few years.

How to Determine Your Life Insurance Needs

To figure out how much coverage you need, consider:

• Debts: Mortgage, car loans, credit card debt.
• Income Replacement: How much do your dependents rely on your income?
• Future Expenses: College tuition, weddings, or other big costs.
• Final Expenses: Funeral costs, medical bills.

Online calculators, like those offered by Progressive, can help estimate your needs. You can also consult a financial advisor for personalized advice.

Conclusion

There’s no perfect age to get life insurance, but starting early—ideally in your 20s or 30s—offers significant benefits. You’ll pay less, secure coverage while healthy, and ensure your loved ones are protected. As you age, your needs change, so it’s important to review your policy regularly.

• In your 20s, a small policy can cover debts and lock in low rates.
• In your 30s, increase coverage for family and mortgage needs.
• In your 40s and 50s, adjust for higher income and college costs.
• In your 60s and beyond, focus on legacy and final expenses.

Life insurance is about protecting those you love. Don’t wait too long—start exploring your options today.