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Why do you need life insurance and how much do you need?
We just had our first baby girl. I'm 37 and my wife's 33. I've read online that a term life policy for 20 years is a reasonable hedge against the unexpected. Based on online suggestions of 10 years salary, I'd be looking for a policy worth $1 million.
Do it...my wife and I both have 20 year terms on each of us. 10x annual salary. I purchased 250K more at work because it is $10 a month.
I don't know of any gotcha clauses. It is the most pure form of insurance you can buy. Pay the premium and you are covered. Stop paying and you are not.
The question is how long it would be, expected to be, before your wife is working enough to cover the other household costs.
My main motivation is to be able to cover not only current liabilities but also to provide for the child's education and upbringing, hence the $1 million. Am I missing something?
We just had our first baby girl. ...... a term life policy for 20 years .......
If that is going to be your only child, 20 years will get her mostly grown and halfway through college. If you plan on having more children, you might want to look into expanding that length of term. If you have a child 5 years from now and die when she is 16, there won't be any insurance and a 16 year old has some expenses that your wife will have to figure out how to pay for.
The younger you are the lower the price. Pencil it out as to whether it is a better value to buy more years of coverage now or better to buy 20 years and add more years if you have more children.
PS: I don't have any reason to carry life insurance, but if I did, I would have enough to pay off the mortgage so my family would have a secure place to live. You can buy a policy that just covers the mortgage, usually through the mortgage company and that is inexpensive.
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