Why you need life insurance, even with no dependents


Claire Damgaard PHOTO CREDIT: Jessica Reilly

You might think that you don’t need to worry about life insurance until, or if, you have children. After all, there’s no one who relies on you to feed, clothe and educate them.

Remaining uninsured, however, could prove to be a big financial mistake, even without dependents.

Here’s why:

Life insurance can shield your surviving loved ones from financial hardships they might face if you pass away unexpectedly. This could apply to anyone who relies on your ability to provide for them financially, including aging parents or a spouse who doesn’t work outside the home.

Even if your spouse has a full- or part-time job, consider what would happen if the income you bring in was permanently lost. Would your spouse be able to handle all living expenses, including large bills like mortgage payments? Would he or she be able to continue paying off debts you share?

Many partners would not be able to cover the expenses of their lifestyle without two incomes. So, considering life insurance to protect each other is a critical financial planning step.

If you decide to look into life insurance, you will have to decide how much you and your spouse need to protect each other.

There are several ways to determine how much coverage you will need.

One method is to multiply your salary by five or 10. This might make the most sense; however, when you have minor dependents who will need financial help to see them through college and early adulthood.

If you and your partner simply want to protect each other, you might need coverage that will cover only one to two years of expenses.

Perhaps the most accurate way to measure how much you will require is to consider the amount your surviving spouse would need to handle his or her actual financial needs, whether it’s paying off the mortgage, satisfying debts or providing care to aging parents.

Life insurance can provide you with peace of mind and the knowledge that your surviving loves ones won’t face serious financial hardship after you’re gone.

Claire Damgaard is an agent with New York Life Insurance Company in Dubuque.

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