Why Single People Need Life Insurance Too

Despite some common misconceptions, life insurance isn't just for those of us who are married with children. If you're a single, you can benefit from it, too, because being unmarried doesn't necessarily mean being alone: In all likelihood, your death would have a financial impact on others. "Some think that if you're single and don't have a spouse or children, then there's no need for life insurance," says Todd Laszewski, director of life product development at Northwestern Mutual. Then too, there's the bravado of youth. "There is a feeling of invincibility: Young, single people are generally healthy and likely not concerned about the risk of an untimely death," he says. "They simply don't consider that there is a need, and in a fact, a long-term benefit, to considering how life insurance fits into their financial security planning early on." "Life insurance for a single person doesn't always make sense," points out Michael Wall, president of Wall Financial Group, "but sometimes it's a perfect fit." Who needs it, and how much, for the most part comes down to the goals of the person. Vicki Brackens, a senior financial planner with Brackens Financial Solutions Network and MetLife, (MET) thinks that only a tiny percentage of the single population really needs no life insurance at all. "It could be that rare person who is not attached to anyone or anything, and they don't care about their legacy," says Brackens, but for a variety of reasons, it's a good tool for everyone else. Your Life Won't Always Be Like This For starters, consider your "end of life expenses." Who is going to pick up the remaining tab for your debts, mortgage, funeral, car and other responsibilities? Next, ponder your legacy. "Life insurance can be a great way to leave a tax-free legacy to nieces, nephews or anyone else," says Wall. That list also includes your favorite charity. "You could buy a single policy that would pay a lump sum to the organization or have the policy paid to a trust and create an income stream for as long as you desired," he adds. Know too, that life insurance purchased today can protect your future insurability. When you're young and healthy, not only is life insurance cheaper, but getting a policy early in life eliminates the risk that later health issues will make you uninsurable, or saddle you with premiums that would send you to the poor house, points out Frank Darras, a lawyer with DarrasLaw, which specializes in insurance. You're also not likely to be single forever: Buy a policy now, and you can just build on your existing coverage once you're married, instead of starting from scratch when you're older and initiating coverage will be more expensive.