Do I Really Need Life Insurance?


I was checking my online banking this morning and as usual my Life Insurance Payment has gone out! As a 27 year old hopefully healthy guy, I do have a tendency to look at this payment and think “do I really need Life Insurance?”

I mean the statistics are with me on this one. I’m young, live a relatively healthy lifestyle, havn’t touched a cigarette or drug in my life (As long as were not classing alcohol as a drug!) and do plenty of physical activity. I’d like to think I’m a pretty safe bet!

As much as I’d like not to payout for Life Insurance every month the second I even think about cancelling it my common sense starts to kick in!

Are Any Of Us A Safe Bet?

Yes I’m young and hope I’m healthy but does that really mean I’m a safe bet?

Look back on your life to date. It’s not the nicest of things to think about but how many tragic situations involving young people can you recall? It may be in the media, it might be an acquaintance or sadly it might even have been a friend or family member. The fact is none of us are immune to the tragedy of life.

If you were to struck down with a serious illness or worse, would you regret not having taken out Life Insurance? I’ll explain why I would!

My Wife!

I’ve been happily married to my wife for 5 years now. She’s the mother of my children and the one who I swore to take care of for better or for worse!

What would happen to her if something was to happen to me?

Well if I didn’t have Life Insurance who knows? She would likely have to sell the house. A place that holds all our memories of married life and of raising our two amazing boys. These kind of memories are so valuable when life is going well, never mind when it hits you with tragedy!

Would she be able to feed and clothe the kids? Would she have to put them into daycare and work just to be able to support them when they needed her most? Just as importantly, would she be able to have enough financially stress free time to be able to rebuild her life? These are horrible things to think about but are so important when considering whether you need life insurance!

My Kids!

What could the future be like for my kids if I didn’t have Life Insurance?

I grew up in a poor area of town. To be honest it never really bothered me because at the time that was just the way things were. Do I want better for my kids if at all possible though? Yes! As things stand we live in a nice town, on a nice street with nice neighbours! If something was to happen to me however, what would the future hold for my kids?

I don’t think my wife could afford to pay the mortgage on our current home. With two kids to support and look after, would they have a repeat of my life on a poor estate? I think they would! Even if they managed to avoid the worst area, with only one income in the family they would certainly end up in a poor area of town.

The situation would be completely different with a Life Insurance payout though. They would be secure in our current home with the mortgage paid up! There would also be a lump sum left over to either use or invest, whichever would give them the best future!

The Worst Thought – Funeral Costs

This is so horrible to think about that I don’t even want to delve too deeply into it. Let’s just say that in the most tragic of circumstances, does anyone really need to be worrying about this!

In hard times most people are looking for ways to save money. I really feel though that of all the things you should cut back on, Life Insurance isn’t one of them!

15 Responses to Do I Really Need Life Insurance?

  1. Meghan says:

    Yes, agreed, this is the most important thing anyone can do for their family. One of my co-workers just died a couple weeks ago, so I’ve really been thinking about my life insurance. For now my policy through work is sufficient since I don’t have a husband or children, but once I get to that point I’ll buy an extra policy.

    • Money Bulldog says:

      Hi Meghan, I’m glad you brought up the fact that it’s just as important for individuals as it is for families. I wrote about my wife and kids because they’re the people closest to me. I think a follow up post on it’s importance for individuals as well as families is a good idea though!

  2. Oh my… you bring up lots of good points Adam. I think I need to let my BF read this post haha. Since we are young, we tend to ignore death and the end of life. Let’s face it, thinking about it is truly depressing, but the reality is that there are still things that need to be paid even after you die. Okay I’m just getting depressed now, I’ll end it here. Hope you enjoy your weekend!

    • Money Bulldog says:

      Yeah get him told! Sorry, Wasn’t meaning to depress anyone. I had the idea for this post and when I started writing it, a lot more came out than I thought. Maybe I should’ve posted it on a monday instead! I just think it’s worth the money when you think of how many unexpected problems it could solve.

  3. Jason says:

    If you are married or have dependents then it’s absolutely necessary to have life insurance. The tricky part are those younger, single guys/gals but it could also be necessary for them if they carry a lot of debt (outside of student loans).

    Instead of paying the monthly premiums, have you considered paying annually instead? It won’t save you a ton of money but it will be a few bucks.

    • Money Bulldog says:

      I’ve done it in the past but nowadays with two young boys to look after I find it more convenient to spread the cost. It’s the same with car insurance, you can save a healthy amount by paying up front but most people I know pay monthly because of circumstance. I also have extra cover for critical illness which I also view as essential but this does bump up the cost.

      To all those reading these comments though Jason makes a great point, if you can afford to pay for the year up front then do. You’ll save a lot of money over the year!

  4. I’ve thought the same thing as you about life insurance. But I always settle on keeping my Term policy. Realistically, its such a small amount of money for the trouble and piece of mind it saves. Everyone with a family should at least have some form of insurance.

    • Money Bulldog says:

      Agreed! Imagine if something happened the week after you’d cancelled it, what a mess would be left behind!

  5. Tackling Our Debt says:

    I believe in life insurance as well because you just never know, plus once you are ill it is much tougher to get. And funerals are a lot more expensive then most people realize.

    When I worked a corporate job I signed up for insurance through the benefit plan. As soon as I left there my husband and I bought a personal plan and we pay for it monthly. At this point we are worth more dead than alive. Sorry, just had to say that 🙂

  6. I totally agree with this post. My husband just got life insurance because he started med school and took out crazzzzy amounts of student loans so he wanted to make sure to protect me in case something bad happened to him. It’s horrible to think about but in the worst possible scenario, I’ll be glad to have it!
    Budget Blonde

    • Money Bulldog says:

      It seems that Student Debt is a big factor on decisions regarding Life Insurance in the US, many people have mentioned it to me in the past. Glad you’re fully protected!

    • Brian says:

      Are you a co-signer on the loans or do you live in a community property state? If you say no to both of those, then his loans would go away upon death. That being said, the fact he has insurance is good for you since you will lose out of his potential income.

      Personally I am a bit under-insured by most people’s standards. At the moment we own our house outright and have a large chunk of change saved, so my wife would be fine. But since we now have a kid we are re-evaluating insurance and will probably both get a term policy.

  7. Ethan's Money says:

    Hi – this is a great post.

    In my day job I work for a big corporate, so separate life insurance for me isn’t an issue. However I agree that you need to think about your family and ensure that your life cover (whether provided by your employer or through a private scheme) is sufficient.

    One interesting perspective that isn’t covered by your original post is the impact of a partner’s death. The highest-earning spouse in a relationship will often worry about the impact upon their family of the loss of their income.

    But it’s easy to neglect the contribution of whichever spouse spends most time caring for your children. If I lost my wife, the demands of picking the kids up from school, etc, would prevent me from carrying on in my current job. Without life insurance, my family would be in a very difficult postition.

    I suppose my point is that you need to think about your life insurance requirements from various perspectives.

    • Money Bulldog says:

      Hi Ethan,

      Your right, I was looking at it from only one point of view and didn’t want to ramble on forever. If something was to happen to my wife, life as I know it would change completely! Having the correct Life Insurance would certainly give my children and I a more financially stable future and allow me to focus on their needs, rather than be worrying about money!

      I think i’ll have to follow this post up with a view from the other side.

      Thanks for the comment

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