Top 6 Critical Lifetime Milestones When To Buy Insurance

by Hank Coleman

When To Buy InsuranceOur lives are constantly changing, but far too often our life insurance policies do not keep up with our changing lives. Have you hit a different phase of your life? Have you reached a new milestone? With each new milestone in your life, your life insurance coverage may need to change. So, you must decide when to buy

With each new milestone in your life, your life insurance coverage may need to change. So, you must decide when to buy life insurance, when you have enough, and when you need to add more life insurance coverage to protect your loved ones.

No matter if you are starting to work at a new job or you are retiring, you may need to rethink your life insurance coverage. You may need to adjust your life insurance policies if you are newly single or just got married. Buying a new home or having children can also be a signal was to when to buy insurance. Each milestone in your life and transition to the next phase of your life can trigger a time when to buy insurance. Your unique personal circumstances often

Each milestone in your life and transition to the next phase of your life can trigger a time when to buy insurance. Your unique personal circumstances often warrant a time to reexamine your financial life. The right amount of life insurance that you have will change throughout your life as the circumstances of your life changes over time.

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Changes in your life may require changes in your insurance coverages. Here are a few milestones in your life when you should look at buying new life insurance and increasing your coverage.

Life Insurance When You Are Single

If you are single and do not have children, you may not need very much life insurance. Although there are a couple of instances that you may want to consider purchasing life insurance while still being single. One reason that you may want to consider purchasing life insurance is if you have significant debts from cars, homes, or other assets that will need to be repaid by your estate. You may want to consider buying enough life insurance to pay off your home mortgage, any car loans, student loans, credit cards, and any other debt that you may have. 

This is one reason when to buy insurance that you may want to consider. Another reason that you may want to buy life insurance while you are single is to guarantee your insurability later in life. You can purchase riders for insurability later when you may be in poorer health and would have trouble buying life insurance. You should also consider the cost of life insurance. 

When you are young and in your 20s or 30s, life insurance is considerably cheaper than it would be if you had to purchase the same type of life insurance policy later when you are in your 40s or 50s. This is especially true when you buy whole life insurance. You may not see much difference or only a smaller rate increase when you purchase term life insurance.

When To Buy Insurance: Becoming A Newlywed

When you get married is one of the biggest times in your life, and it is also one of the most important times when you need to consider adding additional life insurance. Now, more than ever, someone else will depend on your income for their everyday needs. That is the entire point of life insurance to protect your income for people who depend on it to live their lives. 

If something were to happen to you and your income was stopped, how would your loved ones survive? Life insurance is made to protect that income stream. Now that you are married, you most likely have someone else for the first time who depends on your income. That’s why now may be the best time to relook at your life insurance needs after becoming a newlywed.

When You Become A Parent

Like when you get married, having children can be a life event that will make you reconsider how much life insurance that you have. Now you most likely will have two or more people who will be dependent on your income for survival. And, now you must think about your child’s wellbeing decades away as well. It is a long time until they will be 18 years-old and out of the house. 

And, now you must think about your child’s wellbeing decades away as well. It is a long time until they will be 18 years-old and out of the house. And, what about college? Did you want to pay for their undergraduate degree? 

You may want to consider having more life insurance in order to provide coverage for their education that you would have done yourself if you were alive during those years. Remember, life insurance is preparing your family financially should the worst happen and you die prematurely. This also a good time to consider life insurance even on a spouse that does not work. whether or not they work, should be covered.

Bought A Home? Do You Have Enough Insurance?

Now that you have bought a new home, you will need to consider having enough life insurance to pay off your mortgage should you die prematurely. Many new homeowners are bombarded with offers for accidental death insurance. You may even see the offer of wrapping it up in your mortgage payment from your bank at closing. 

This is not a good idea. You can save money on your insurance premiums by simply having enough life insurance to pay off your debt when you die…all of your debts including your mortgage. But, you may need to relook at your life insurance policies to ensure that you have enough coverage. Buying a new home is a great time to reconsider your life insurance coverages and may be a good time when to buy insurance if you need additional coverage.

Getting A Divorce?

Are you getting a divorce or have recently gone through one? Now may be a time that you need to relook at your life insurance needs. Maybe you need less life insurance. More than anything else, you probably need to reconsider who you have listed on the beneficiary designation form. This is an important step and one that is often overlooked.

You do not want your life insurance benefit to be paid to the wrong person simply because you failed to update a form with your insurance company. The courts have a hard line that they typically take on this matter, and failing to update the beneficiary designation form can be disastrous for your family that survives you when your insurance is paid to a person that you do not want it to be paid to. 

Do you have to make alimony or child support payments? You will need to make sure that you continue to have life insurance to help those people who you are responsible for.

About To Enter Retirement

When you are in retirement, hopefully, you have a house that is paid for and children that have graduated and are on their own wit their own families. You may find that you do not need as much life insurance when you enter retirement. 

You may only need enough to cover any final debts as well as enough to pay for your funeral. You will also want to consider if you want to leave an inheritance and if you want any life insurance to pay any estate taxes that you may be facing upon your death. But, as a general rule of thumb, there is very little that you would need much life insurance for when you reach the typical retirement age.

Are there any life events or milestones that I missed where you need to reconsider when to buy insurance? I’d love to hear your thoughts in the comment section below.

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About Hank Coleman

Hank Coleman is the founder of Money Q&A, an Iraq combat veteran, a Dr. Pepper addict, and a self-proclaimed investing junkie. He has written extensively for many nationally known financial websites and publications. Hank holds a Master’s Degree in Finance and a graduate certificate in personal financial planning. Email him directly at Hank[at]

Hank Coleman has written 582 articles on Money Q&A. Learn more about Money Q&A on Twitter @MoneyQandA and @HankColeman.

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{ 7 comments… read them below or add one }

Al Olsen

I think that perhaps long term care insurance should probably we considered as one enters his or her late fifties.


Hank Coleman

That’s definitely a great point. Not a life insurance consideration though but a great point nevertheless.



Life insurance particularly in retirement is more than just covering debt, it is for income replacement too. Your circumstances will change and you may need income replacement.


Hank Coleman

It would depend on what type of income you have coming in during retirement. You may need life insurance to cover an income stream from a pension for your spouse or loved one who depends on that income. Some pensions also have it built in as well to protect the spouse. It all depends.


Kevin @ Growing Family Benefits

Life stage thinking is critical to making the right insurance purchases. Our needs change in line with circumstances. This is a great list for life insurance.

There is another life stage and a different type of insurance to consider: Before you become a parent, mom should buy short term disability. She is planning to miss work to recover from childbirth. What could make any more sense?


Hank Coleman

That’s a very interesting thought about disability for childbirth. You would definitely have to read your policy to make sure that that was covered. Great tip though. Thanks!


The Insurist

Thank you for posting about this Hank. For some reason we’ve come to believe life insurance is some sort of static activity. “I took care of my life insurance needs 10 years ago.” Best practice is to review your life insurance policies annually to make sure they are doing what you intended them to do.

On the long term care subject…one of the best ways to cover this risk today is to add a long term care rider to a life insurance policy. This takes away the “use it or lose it” concept of stand along long term care policies. If the benefit is never needed it passes on to the insured’s beneficiaries as a life insurance benefit.


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