20yrs old... need help with life insurance, of all things.?

Question

I'm 20 years old and 5 months pregnant with my first child. I'm starting to think about things like life insurance. I know I want term life insurance and not whole because I am already set up with a 401k at my job. The quotes I'm getting are confusing me and I'm not entirely sure what to ask for in terms of years (20, 25, 30 etc) and amount (500,000 750,000 etc). How much should I be paying monthly and can anyone recommend what a healthy 20 year old with (soon to be) one dependent should be going after for a life insurance plan?

Answer 1

I think you are on the right tack, what you need now is some professional assistance. You can use yellowpages.com to search for life insurance brokers in your area.

A Broker represents multiple carriers and can help you sort through all the different insurance companies and plan options in your state.

You can call your auto and home agent they specialize in property and causality insurance and usually have a good knowledge of life insurance.

But you may have better luck with a broker that specializes in life insurance they will have a wider selection of companies to offer.

I have a quote engine you can use and no one will contact you. http://www.insurancemadeeasy.biz/Life.ht...

Answer 2

Married? Single? Debts? House Payment?  Those are needed to decide how much you would need.  It is good to get enough coverage to cover debts, a portion of your income for a few years for your spouse (assuming married).  And enough to help cover living expenses for your child for whom ever takes care of them (assuming single).

Is college education a factor? Yes.  Do you want to pay for all, half, some, none of it? Which school would you like them to attend? Those are needed to figure that out.  The amount will need to be figured out with inflation.

Any amount above 200-250k will probably require a minor medical exam to be done.  Since you are pregnant, it may cause a problem but is also explainable...so it may not.

The cost will be cheep.  I would suggest getting one for the longest possible time you can find...should be 35 years.  As of now, only 2 companies I know of offer it out that long and both are reputable.

I can't give you an amount to get since we don't know your full situation.  I do agree you need to talk with someone local to get a better idea of what to get.

The fact you have a 401k has no bearing on type of insurance.  That being said, term is still the better choice in many cases.

I wish you luck and congratulations.

Answer 3

You need to think in terms of what that child would need should you die. Depends on what you want to provide him. Food? Shelter? A college education? A half million in insurance is not a lot these days. But at age 20, it's goign to be very cheap, too. Start here to get an idea of cost. http://www.accuquotelife.com/index.cfm?r...

Answer 4

Life insurance is a product that would make sure your debts are paid in full to protect your heirs and to make sure your child is taken care of until the age of 18, at least.

So, with that being said, take into consideration how much you owe and add enough for someone to care for the baby.  That is how you would calculate how much to buy...and just so you know, it will be very reasonable;-)  You are young!  That's the good thing;-)

Take care of that baby!!!

Darlene M

Answer 5

The 401(k) really has nothing to do with the choice of life insurance types.  If you're going for term insurance, you should be able to get cheap premiums at your age - I'd go for the 30 year term and at least $500K in coverage.  However, you may not be able to get the policy until after your baby is born.

Yahoo Finance (under "Personal Finance") has a section on life insurance.