How Much Life Insurance Should I Get At Age 30?

At 30 years old, you’re just starting out in life right? You may or not have a family yet but probably own your home. So at this point of the game there are definitely things we all want to talk about- like whether buying life insurance is something worth considering for ourselves as well as those close enough who depend on us such that they could need protection from financial loss should anything happen unexpectedly (even accidents).

But don’t worry; Billy Explores is here today with some helpful insights into what kinds of questions might be important when looking into these types life insurance policies. We’ve compiled some great information that can help you figure out how much life insurance you actually should have before you go ahead and buy life insurance.

Of course, once you’ve decided to buy life insurance, you need to compare life insurance to find the best value life insurance that meets your needs. Billy Explores can help with that too! How awesome is that! 

Why You Haven’t Thought About Life Insurance Yet

You’re 30 and indestructible, or you know you have life insurance in your super. Or you actually don’t know what life insurance is!

You might actually know the term ‘Death Cover’, which is another name for life insurance. What happens is that you can purchase a life insurance coverage that pays an agreed lump-sum if you pass away. Essentially, it is designed to replace the income you would have earned if you die. This means that if you’re gone, your family can still meet financial obligations such as mortgage.

There are also other elements of life insurance which are definitely important as well to protect yourself, especially if you’re 30 years old. Read up on Income Protection, Total Permanent Disablement (TPD) Insurance and Trauma Insurance which are certainly applicable for 30 years old in this stage of their lives.

Should a 30 Year Old Buy Life Insurance?

There are many reasons why a 30 year old should buy life insurance. For starters, you will be secure in the knowledge that if something happens to you, you and your family will be protected financially. Secondly, your family’s financial commitments will be covered in the future should something happen to you.

However, before you compare life insurance and get the best life insurance policy in Australia for your needs, various factors need to be considered (including the below we detail in depth). Also to consider are items such your life insurance term and life insurance coverage.

So, I’ll Buy Life Insurance – But How Much Do I Need?

After you’ve decided you want to buy life insurance , the next step is working out how much you need. It can sometimes feel like ‘how long is a piece of string’ but the key here is balance, and understanding your actual family requirements. You need enough life insurance coverage so you, or your family, are able to meet your financial commitments. This is either after you’re unfortunately gone or you can no longer work because something bad like an illness or major injury has happened to you. 

If you’re underinsured or don’t have the right life insurance term, you or your family might be left in the lurch and struggling to pay bills without your income. But of course, you don’t want to buy life insurance and also pay life insurance coverage premiums that you don’t actually need. Of course, don’t forget at any stage you can always compare life insurance and get the best life insurance policy in Australia from our panel of providers for your and your family’s needs.

Live Insurance Coverage Needed At 30

There’s a general “rule of thumb” method for working out approximately how much life insurance coverage you really need so that your life insurance payout can replace your income if you pass away or can no longer work. To start, write the down all the answers to the below:

  1. What is your income each month?

    Firstly, write down how much you and your family actually earns each month. This is the basis of all future income requirements to meet your commitments.
  2. How much do you spend on living expenses each month?

    Grab your bank statements and then itemise all of your costs. This includes rent (but not mortgage), groceries and power bills, school fees through to phone plans. Write down all of your spending, which will then give you a monthly figure. For example, $2,000 monthly spend – this is called your living expenses.

  3. How much do you owe?

    Write down any debt you’re paying off. Things like a mortgage or car loans are easy, since it’s a set monthly repayment for a specific number of years. Other debts like credit cards are harder, because they can rise and fall as you spend, and it’s not as easy to know how long you’ll have to cover that debt for.

  4. What is your family savings plan?

    Your family savings plan also needs to be included. There are two reasons to talk about this: on the one hand, the more you have saved, the less your family will be reliant on any insurance payout to meet financial commitments and general living expenses. That also means you can opt for a lower level of life insurance coverage and pay lower premiums.
    On the other hand, if your family savings plans are working towards any savings goals, you may need to add that into your life insurance coverage and payout – for example sending your kids to university or helping them with their home deposit.

Now Calculate How Much To Buy – Life Insurance

So we’ve got all of the information above, now you need to know how much life insurance coverage you need. As a general rule of thumb, follow the below steps:

Step 1: Add the following items above to calculate what your financial commitments are:

  • Your annual salary multiplied by the number of years you want to replace that income
  • Your mortgage balance and another other debts
  • Any future living expenses such as school fees, university fees, travel and funeral costs.
  • Family saving plan
  • The cost to replace services that a stay-at-home parent provides, such as childcare, if applicable.

 Step 2: From that total, subtract any liquid assets you have, like savings or share portfolios, and current life insurance policies.

The dollar number you’re left with is the amount of life insurance you should buy as part of your life insurance coverage.

When Is The Best Time To Buy Life Insurance if I’m 30?

So, we’ve figured out how much life insurance you actually need, but when is the best time to buy life insurance? The answer is entirely up to you and your family’ financial commitments, and how much premiums you can afford to pay.

You can generally get a life insurance policy up until you’re about 65 years old, and get life insurance coverage up until you’re 99. But remember: life insurance premiums get more expensive as you get older and the shorter the life insurance term, so thinking about life insurance earlier is a good idea. And of course, you can regularly take the opportunity to compare life insurance in Australia through Billy Explores! You can save time and effort no matter your age, and get the best value life insurance in Australia from our panel of providers that’s perfect for your needs!

Life Insurance Comparison In Australia At 30 Years of Age

So, you’ve got all the information. Now the final step is to compare life insurance providers and get the best value life insurance policy in Australia that is perfect for your and your family’s needs, that’s available from our panel of life insurance providers! They will help you get the best life insurance term and life insurance coverage for your needs. All you need to do is provide some basic information and let Billy Explores do the rest!

FAQs

  • How Much Life Insurance Should I Get At Age 30?

    If you’ve decided to buy life insurance, you know you need it, in whatever form it is. The question of how much life insurance you need buy at age 30 is an extremely personal one and based on your own personal circumstance (for example any debts, family etc).  When you buy life insurance, the final cost of your life insurance cover depends on how much and which type you get. It’s often less expensive than people expect. Billy Explores has a helpful guide to understand how much life insurance you actually need.

    It also helps to compare life insurance cover through Billy Explores and our panel of providers. You can save time and effort, and see if you can get a better deal on your life insurance cover here.

  • What Is The Best Life Insurance Cover For My Needs?

    A good start is to review your debts and current family situation before you can answer, ‘What is the the best life insurance cover for my needs’? Every individual’s circumstances is different and your life insurance cover requirements will be different to your neighbours and co-workers. An even better way is by reading our helpful guide: How much life insurance. Of course, you can also find out if you have enough life insurance cover in super here. Billy Explores also recommends regularly checking and going to compare life insurance cover here, to make sure you have the best deal for your needs from our panel of providers.