Why Single Women Need Life Insurance

By Allison O'Connor

Life InsuranceIf you are a single woman, chances are you haven’t given much thought to purchasing a life insurance policy. But as the head of your household, even if your household consists of just you, there are some compelling reasons why you should consider purchasing a life insurance policy.

Single Woman with No Children:

Have you ever thought about what would happen to your estate if you were to die unexpectedly? Who will be responsible for your debts (car loans, education loans, mortgage, estate taxes, etc.) if your estate does not cover these costs?

Well, chances are your family will be responsible. Can you imagine your aging parents or other loved ones who are living on a fixed income having to pay off your car, school loans and mortgage because there wasn’t enough money in your estate to cover these costs? And with the housing market still sluggish, selling a home may not be an immediate option to pay off these debts. But a life insurance policy can cover these costs and provide your loved ones with peace of mind during this difficult period. And, if you choose to remain single, your life insurance can accumulate cash value to help provide a secure retirement for yourself.

As a young, healthy, single woman, you have the opportunity to purchase a life insurance policy at reduced premiums. However, the older you are, the higher your premiums will be. Locking in a low rate for a fixed period of time is an excellent way to secure an affordable life insurance policy. One other benefit, the cash value of your insurance policy can also be used to secure loans.

Keep in mind, that should you decide to get married and/or have children, your life insurance needs will increase. Re-evaluating your policy with each life change is a smart move.

Divorced and Widowed Single Moms:

Did you know that only 4 percent of all life insurance policies sold in 1997 were purchased by divorced or widowed women (“The Women’s Market: Myth & Reality,” LIMRA International, 1999)? This startling fact means that a majority of the 11 million single moms in the U.S. today are without life insurance. As a single mom, if you do not have life insurance, you run the risk of not having your children’s basic needs met should you die unexpectedly, especially if there is not a father in the picture. Note: In addition to providing for your children’s college tuition and living expenses, single moms may need to factor in additional expenses such as child care and domestic help that a life insurance policy could cover.

Purchasing a life insurance policy as a single woman is a critical step to securing yours and your family’s financial future. In fact, recent studies show that 60% of American women will be living alone by the time they are between the ages of 80 and 85 years. Currently half of these numbers of women live in poverty because they neglected to buy life insurance and benefit from the cash values in a policy.

The Amount of  Life Insurance You Need is Determined By:

  • Your age
  • Debt
  • Whether or not you have children
  • The number of children you have
  • The ages of your children
  • Your overall health
  • The amount of your social security benefits your family will receive
  • The amount of money your family will need to survive

What Type of Life Insurance (term, whole life, annuity, etc) Should You Purchase?

Ask a qualified life insurance representative for policy options, terms and conditions, premiums and the ability to change your policy should you have a major life change such as getting married and/or having children. You will also want to shop around. But before you do, spend some time educating yourself on the types of policies available and become familiar with the terminology.

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Financial Planning Tips for Self-Employed Single Women