October 5, 2022

Life Insurance: You tell me to buy young… Why?

In your 20’s or early 30’s you may not think life insurance is something you need or want since you are young and most likely still at the prime of your health.  

Good Health and youth translate to lower insurance costs, even if you have a condition medically, youth will keep your premiums as low as they will ever be. There are other things to consider when applying for insurance be it life or living benefits (disability or critical illness). Some considerations include:  

Age 

Health generally deteriorates with age. As such, insurance premiums usually increase with age. 

Gender 

Females have a longer life expectancy on the life insurance calculation; however, men get better rates on the disability pricing as they feel more women make disability claims.  

Hobbies and occupation 

If you like to sky-dive in your spare time or work as a rock-climbing instructor, your premiums are going to be higher, or you may even be declined for coverage because the insurer views you as a higher risk.  

Smoking/Vaping  

If you smoke or vape you will likely pay 2x the cost of a non-smoker when looking at insurance both life and living benefits. 

The obvious reason to buy life insurance is you have a clear insurable interest, such as student loans or mortgages. You may also want to be sure your loved one’s spouse or children are covered in the event of a catastrophic accident and rely on your current income.  

There are multiple factors to consider when buying a policy and working with Northfront Insurance Corp. We can determine what policy suits your need the best. Be it a term plan to cover short-term debts and income replacement, or a permanent life policy that will last your entire life generating a cash value and investment component which could later in life could result in large sums of tax-free income. 

The bottom line 

Even if you cannot afford a permanent life insurance policy, most 20-somethings can receive very good term policies for very low costs such as $200,000 to $300,000 in coverage for $15 to $20 a month in some cases. More importantly, some term policies can last for 20, 30, or 100 years; you could be covered at a very low cost throughout your entire working life. We all have a need for insurance at certain times in our lives and being prepared could save you thousands of dollars. 

About Northfront Financial

Northfront Financial, based in Calgary, Alberta is a boutique full-service financial planning firm serving professionals and business owners. We pride ourselves on being a different kind of investment firm. This stems from our humble roots, entrepreneurial spirit, and a culture of integrity and professionalism. Our goal is to offer the best investment products, services, advice, and ideas the financial industry has to offer from our experienced team, which includes individuals with the Chartered Financial Analyst® (CFA®), Chartered Investment Manager (CIM®), and Certified Financial Planner™ (CFP™) designations.

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