I'm glad I got life insurance before taking 50 trips in 2020 - Business Insider

Posted: 27 Dec 2019 12:00 AM PST

Life insurance just never seemed important. I had a million excuses disguised as reasons why I never took the time to get it: I was too busy. I was too young. My husband would take care of it.

The next thing I knew, I was almost 50. My daughter was a teenager, and my husband was no longer my husband. For the first time in my life, I felt the incredible burden of leading my family financially.

Maybe being a single mom should have been enough to move life insurance to the top of my to-do list, but it wasn't. Life insurance didn't seem to fit into my tight budget.

It wasn't until I was just months away from embarking on an ambitious plan to visit 50 places I've never been the year I turn 50 that it felt necessary.

How traveling changed my mind about life insurance

I've never been comfortable with anything related to finances or numbers, but it was obvious even to me that the sheer number of trips I would be taking increased the chance that something could go wrong. The financial responsibility to provide for my daughter carried extra weight when I considered what would happen if I wasn't there for her.

That thought came in the middle of the night, when my brain has a habit of shifting into overdrive. This 2 AM epiphany left me with a sense of urgency about getting life insurance.

The next morning, I googled it. Sure enough, experts say I should have taken care of this about 15 years ago. I called a friend who happens to be a financial adviser and asked his opinion. Evidently, he agreed with the other experts. He couldn't believe that at the age of 49 I didn't already have life insurance.

As he started tossing around words like whole, term, payout, and death benefit, my heart started beating a little faster. I struggled not to make up some excuse to get off the phone. I don't like being in unfamiliar territory. Deep breaths. If my divorce has taught me anything, it's that I can figure things out.

Choosing a policy

The first thing I had to decide was what kind of life insurance was going to work best for my situation. Here's the essence of what I learned: Term life insurance only covers a certain period of time. It's considered temporary.

Whole and universal life are considered permanent options. Both cover your entire lifetime and premiums are typically higher than term life. Each of the options offers specific features to consider.

Next, I had to determine how much insurance I needed. If you aren't good with financial discussions either, brace yourself. This is the part where the numbers start to sound big. Experts generally recommend six to 10 times your salary, but there is no one-size-fits-all formula.

I was advised to take into account all debt, including mortgage, credit card, and car loans. There are online calculators that can help you figure out the optimum amount.

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Two factors primarily impact your premium. One is the length of your term. The other is your health, which is another reason you shouldn't wait until you are my age. I had to undergo a series of tests before they approved my policy.

In some cases, what you want for coverage and what you can actually afford to pay toward the premium don't match up, so you'll have to do some adjusting.

I wasn't concerned about leaving my daughter a life of luxury, but I did want to cover my liabilities so she wasn't stuck with them. I also wanted to help cover the cost of her education and, dare I say it, my funeral.

Ultimately, I settled on a 15-year term policy for $200,000. The annual premium is $565.

I'm glad I finally checked life insurance off my list

Getting life insurance started out as a daunting task. By the time it was over, however, I felt empowered, like I won adulting for the day.

The process gave me a sense of control that I desperately needed. It also gave me the confidence to know that I could handle the kind of stuff my husband "took care of" in the past. Now I know that no matter what happens in the near future, I have done what I can to provide for my daughter. There is nothing more important to me.

I fully intend to return safely from my trips next year visiting 50 places I've never been to as part of my year-long 50th birthday celebration, but I've learned life doesn't always go as planned. Come to think of it, with less than a month to go before the first trip, there are a few more things I should probably take care of on my "better late than never" list.

Next up, (deep breath) getting a will.

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