Life insurance questions

**frugal.lass** · 01-19-2012, 12:54 PM

In 2005, my auto insurance provider told me that it would save me money to get life insurance through them (it was aprx $180/mth for auto alone or $175 for auto & life insurance together.)

When purchasing a home a few months ago, I (lazily) opted to go with them for home insurance as well, making it 3 policies I had with them. I called my insurance company today to find out how to go about cancelling my life insurance policy since I qualify for the multi-policy discount with just auto and home insurance.

Here's the question; I'm not really shooting myself in the foot like my agent inferred, am I? If I pass away, there's $11 000 in my various bank accounts, my policy at work pays out $75 000, I'm debt free other than my mortgage (and my home could probably be sold easily, my area of town sells well), I'm 30 with no health issues AND I don't even have any dependants (single, no kids, just 2 cats...lol)! I'm thinking I'll be just fine and can redirect that $29/mth somewhere more beneficial but I'm also worried that maybe there's something I haven't considered...

Thoughts?

**mombottoo** · 01-19-2012, 01:04 PM

If you become unable to work you will no longer have your life insurance coverage through work.

Life insurance is a personal choice...we had a crap ton of coverage when dh worked...now, he's disabled and we have none. We cancelled our policies that we owned personally because, he had great coverage at work. At our ages now it is unfeasible to purchase new coverage since the rates tend to be lower when you are younger.

If the $29 a month isn't breaking the bank and you have had the coverage for a while and the payments will stay the same no matter your age...I think I'd keep it.

**monkeywrangler71** · 01-19-2012, 03:36 PM

You have no need for more life insurance since you don't need to support anyone after you die. Your home can be sold to pay the mortgage and your $75K policy is more than enough to settle your affairs.

**frugalfranny** · 01-19-2012, 03:48 PM

I agree with both of the above posters...........

You have no need for life ins. now.........no dependents. Do you want to have it now.........cheaper, and keep it? Think of your situation and how/if it could change.

I have never had life ins.............but not everyone wants to live that way. Sometimes I couldn't afford it (when I probably should have had it).......and other times I didn't WANT to afford it.

**Grayce** · 01-19-2012, 04:18 PM

It much cheaper to keep paying the rates you get when your young. If your situation changes and you decide you want life insurance in the future, your premiums are going to be a lot higher. 29$ isn't a lot of money. I'd keep it.

**frugal.lass** · 01-19-2012, 11:16 PM

Thanks for the responses so far. I'm really on the fence with this one exactly because of the reasons mentioned.

As far as income, I'm pretty maxed out at the moment. I work FT, PT and am taking a correspondence course...there isn't time to do more shifts (I tried and ended up exhausting myself and getting sick) and until I'm done my courses, I can't switch to the new PT job I'm considering (which would be challenging but MUCH more financially rewarding). I've been trying to find ways to tighten my budget and thought maybe that this policy was something I could cut (there are more things that'll change but only when the contract's up in a few months). Darn it, just googled some more and Clark Howard's site says "if you've purchased a whole life policy, its best to keep it"...

Its kinda frustrating because I *could* use that $30 elsewhere (building EF back up/retirement fund/paying off mortgage), whereas if something happened, the life insurance policy would end up going to my Dad, Mom and siblings who are all okay on their own.

**annymoll** · 01-20-2012, 12:41 AM

If you become sick or disabled at a later date you may incur expenses that you have not considered at the present time.Certain health issues will prevent you from obtaining insurance in the future.

**kita** · 01-25-2012, 07:41 PM

It seems you have plenty of life insurance. However...have you looked at your disability insurance? As a single person I would be much more concerned about disability than death. In death, I am a burden for a little while until my estate is settled. When I was living in NJ and my mom and brothers lived in Oregon I thought about the plane fare and time they would have to give up in order to settle my affairs.
If I was to be disabled as a single person, I didn't have children or a spouse who would feel obligated to assist me. An extra $500 a month would mean I could pay the neighbor kid to take the trash to the curb, buy healthy fruits and veges to improve my diet, pay a taxi so I can go to a few special events, provide materials for a hobby to keep my mind/body sharp, and a "church lady" to do the heavy cleaning in my house if my medical insurance doesn't pay for it.
All of those things would VASTLY improve my quality of life. and you are far, far more likely to need disablity than life.