Understanding Affordable Term Life Insurance

Finding affordable term life insurance is an understandable goal. After all, fiscal responsibility is the name of the game where life insurance is concerned, and making sure that you get the best value for your premiums is part and parcel to that. It is important, however, that consumers make the distinction between affordable term life insurance and life insurance on the cheap. One protects you and yours at the best value possible, the other is a waste of your hard earned money. The trick is knowing the difference between the two.

A Primer on Affordable Term Life Insurance

The truth of the matter is that in the grand scheme of life insurance policies, most term life insurance from reputable insurance providers is affordable life insurance. The Motley Fool, a consumer oriented organization that provides practical financial advice, recommends term life insurance because "there's no frills with this sort of plan, which makes it cheap," while the Wall Street Journal's SmartMoney.com says that "for most people, the right type of life insurance can be summed up in a single word: term." Put simply, term life insurance is characterized by inexpensive annual premiums (usually in the $150 to $400 a year range for an average 20 to 40 year old) to procure a substantial payout in the event of an untimely death.

How is $400 Per Year Affordable Term Life Insurance?

If annual premiums ranging from $150 to $400 per year sound expensive to you, there are a few things to consider. First of all, remember why you're buying life insurance in the first place. The point of investing in life insurance is to make certain that the loved ones who count on you will be adequately provided for in your absence, making the question not so much whether insurance premiums are affordable, but whether you can afford not to pay them if you want to protect your family. On a more practical note, a $150 per year policy will cost you a shade more than $12 per month, while a $400 policy costs a little more than $30 per month. Those figures are small potatoes when you consider the several hundred thousand to a million or more dollars that you're procuring for your loved ones in the event that you're no longer there to provide for their basic needs.

The Difference Between Affordable Term Life Insurance and Life Insurance on the Cheap

All that said, you're probably still wondering what the difference is between affordable term life insurance and life insurance on the cheap. The answer to that question can be summed up in a single question: do you have enough? According to a study by the insurance research and assessment firm LIMRA, the average married American man carries $235,000 in life insurance, while the average married woman carries half that, at $147,000. And while that might sound like a substantial payout in the event of your passing, those-in-the-know suggest otherwise. Generally, life insurance experts recommend that your policy amount equals the sum of your annual salary times the number of years your family will need that money to maintain their current quality of life and get back on their feet (generally anywhere from 10 to 15 years). Figure in college expenses for the kids, and protection from unforseen financial challenges that may arise, and that $235,000 falls far short of what the average American family needs to stay afloat. Taking into account a median household income of $52,000 according to the United States Census Bureau, and a policy along the lines of $500,000 to $800,000 is much more realistic when it comes to protecting you and yours.

How To Make Enough Life Insurance Affordable Term Life Insurance

All that said, the trick to finding reasonably priced term life insurance doesn't lie so much in finding an inexpensive policy, but in educating yourself, knowing your insurance needs, and taking the time to shop around for the best deal possible. By utilizing an online broker like NetQuote.com you'll be able to compare the terms, coverage amounts, rates, and services of a variety of affordable life insurance providers on your way to acquiring the best term life insurance policy possible for you and your loved ones.