Life Insurance

Why term life is the easy choice for couples

Ethos Life · May 31, 2018
Older couple walking down path
When you’re in a loving and supportive relationship, the last thing you want to think about is death. But many couples are missing out on a benefit to improve their financial wellbeing. That benefit is life insurance. If you or your partner die unexpectedly - life insurance can help your family heal and maintain quality of life. Here’s an overview of when life insurance can benefit you as a young couple, and when you might be able to go without it.

When One Of You Is A Stay-At-Home Parent Or Full-Time Student

When One Of You Is A Stay-At-Home Parent Or Full-Time Student

If you’re a stay-at-home parent or full-time student, life insurance can safeguard your partner from financial devastation. You may not be working, but you still contribute to the household in valuable ways. Would your partner be able to carry on while taking financial responsibility for your debts, your funeral and burial expenses, and the cost of caring for your children?

Your partner might be forced to hire a nanny, house cleaners, or a personal assistant to keep your home running smoothly. They might even pick up extra hours at work to make up for their increased living costs. Life insurance can cover these bases and more - while your spouse supports your family during a difficult time.

To calculate how much insurance you need, take into account your rent or mortgage, debts, and the educational needs of any children you support or may have in the future.

When You And Your Partner Don’t Have Children Yet

If you plan to start a family soon, purchasing life insurance can be a smart move. Choose an amount that will support the surviving partner and future children. Would either of you be able to take over each other's financial obligations?

If one or both of you have significant credit card bills, a mortgage, car payments, or student loans, it may be a good idea to purchase enough life insurance to pay off those debts. To help determine how much life insurance to purchase for each partner, you’ll need to calculate the potential financial impact that death would cause for the other. How much money would it take for each of you to feel financially secure without the other?

If you are responsible for the financial needs of anyone outside your household, you may need to provide an insurance benefit for them, as well. Your dependents could also include elderly or disabled parents and extended family members.

When One Or Both Partners Have Life Insurance Through Work

Many employers offer life insurance as part of their benefits package. It’s a nice perk and typically costs only a few dollars each month. But, there can be drawbacks to depending solely on this type of policy.

First, if you have employer-provided life insurance, it doesn’t always travel with you when you leave the company. Additionally, employer-provided insurance is rarely issued in the amount of recommended coverage. Consider additional coverage, such as a relatively inexpensive term life insurance policy independent of your employer to help ensure that you will have sufficient coverage during your wage-earning years regardless of your employee benefits.

Rates for all types of life insurance also increase as we age. If you develop a critical or chronic illness in the future, the cost of purchasing life insurance may be too high. You could even become uninsurable as a result of the condition of your health. If you already have a life insurance policy in place when you become ill, as long as you keep paying the premiums, you’ll be insured while the policy is active and in force, no matter how your health changes.

When You And Your Partner Don’t Need Life Insurance

Some of us are lucky and have enough money in savings to cover outstanding debt and funeral expenses, and may be able to skip purchasing life insurance. If your savings can provide for the future financial needs of your family, that is great! In that case, there’s really no need for a life insurance policy.

However, you likely have financial goals that aren’t already covered by savings, not to mention any dreams you would like your family to realize with or without you. If this is the case, you should consider the benefits of an affordable term life insurance policy.

Taking your next steps

Applying for term life insurance with Ethos is a simple way to help protect your family's financial future. Learn more

Learn more about life insurance
Ethos term life insurance is a simple way to guarantee your family's financial future.

When You And Your Partner Don’t Have Children

If you plan to start a family soon, it’s smart to purchase life insurance in an amount that will support the surviving spouse and future children.

Take a close look at your current financial situation. Could the surviving spouse take over the financial obligations of your household with the money they currently bring home? Consider debt as well. If one or both of you have significant credit card bills, a mortgage, car payments, or personal loans, it may be a good idea to purchase enough life insurance to pay off those debts.

To help determine how much life insurance to purchase for each spouse, you’ll need to calculate the potential financial impact that a death would cause for the other. How much money would it take for each of you to feel secure?

If you are responsible for the financial needs of anyone outside your household, you may need to provide a benefit for them, as well. Don’t overlook elderly or disabled parents, nieces and nephews, or friends who depend on your financial support for their quality of life.

When One Or Both Spouses Have Life Insurance Through Work

In many cases, employers offer life insurance as part of their benefits package. While it’s a nice perk and typically costs only a few dollars each month, there are some drawbacks to depending solely on this type of policy.

Life insurance through an employer terminates if you leave the company, so you may wish to consider additional coverage, such as a relatively inexpensive term life insurance policy independent of your employer.

Rates for all types of life insurance increase as we age. If you develop a chronic illness, the cost of purchasing life insurance may be too high. You may even become uninsurable. If you already have a life insurance policy in place when you become ill and you keep paying the premiums, you’ll be insured while the policy is active and in force, no matter how your health condition progresses.

If your employer-sponsored life insurance is free, you may want to consider purchasing an additional policy. It’s OK to have more than one policy in place, as long as the majority of your life insurance goes with you when you change jobs.

When You And Your Spouse Don’t Need Life Insurance

People who are financially stable and have enough money in savings to cover outstanding debt, funeral, and burial expenses may be able to skip life insurance. If they can provide for the future financial needs of the surviving spouse and anyone else they currently support with savings there’s really no need for a life insurance policy.

Having this type of financial stability is something that couples work toward and often want to achieve before retirement. For some, financial success comes earlier. In this case, you are “self-insured” and your loved ones aren’t at risk of financial devastation upon your death.

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