There’s no question that setting goals at the start of a new year is a time-honored ritual. A new year, full of possibility, brings an energizing fresh start.
For some, new year’s resolutions are about physical health, personal development or professional advancement. But it’s also a natural time to set financial goals. In 2021, for example, more than half of all Americans and nearly two-thirds of millennials made a resolution related to their finances.
Dawn Santoriello, a Certified Financial Planner and founder of DS Financial Strategies, says as a new year approaches, many of her clients are reflecting on the past 12 months, looking ahead and feeling inspired to make their family’s future more secure.
As you take stock of your family’s accomplishments and goals for the future, one financial goal that you might consider is getting life insurance.
“The pandemic has taught us how precious life can be and no one is promised tomorrow,” Santoriello says. “If you have a family, life insurance is a necessity. Most households require two incomes today, and a death in the family is emotionally devasting. But it doesn't have to be financially devastating as well. Life insurance is an inexpensive way to make sure your family is provided for when they need it the most.”
Life insurance comes in two types: term or whole life insurance policies. Term life insurance provides coverage for a set length of time, such as 10, 20 or 30 years. If you were to pass away during that covered term, your beneficiaries receive a death benefit, or a predetermined amount of money. They can use this money for anything from your final expenses to daily living costs or funding a college education. When the term ends, so does the coverage.
A more expensive option is whole life insurance, also called permanent life insurance, which lasts for the policyholder’s entire lifespan. Whole life insurance also has a “cash value component,” which grows in value over time, and which you can withdraw or borrow from while you’re still alive. Term life insurance, however, costs significantly less and is much less complicated than whole term life insurance, making it far more affordable.
Colin Exelby, a Certified Financial Planner and president and founder of Celestial Wealth Management, says life insurance is a critical part of managing risk and preparing for the unexpected. “For most people, especially younger people, the most valuable asset they have is their ability to earn money,” he says.
If your working years are cut short, your family could face financial strain that jeopardizes their stability, goals and dreams for the future. Fortunately, Exelby says, you can use life insurance to help fill potential gaps and keep your family on a secure path. “Managing this risk is important so as not to burden your immediate or extended family financially and impact their financial plan as well if something unforeseen were to happen.”
Many people put off getting life insurance because they assume it’s costly—and it’s hard to imagine squeezing one more expense into their budget. But here’s why this may just be your year:
There are many different types of life insurance, and some are much more accessible than you might think. A 34-year-old woman in excellent health, for example, could pay less than $18 per month for a 15-year term and $250,000 in coverage according to a term life insurance quote through Fabric.
Getting life insurance is one of those tasks that often slips to the bottom of a long to-do list. When you’ve got laundry piling up and deadlines to meet, applying for life insurance is easy to procrastinate. But actually filling out the application is faster and simpler than many people expect—you can apply online in about 10 minutes, and you may be approved without a medical exam.
If you're thinking about getting your finances in order, you’re not alone. Amid the loss, uncertainty and new challenges brought on by the COVID-19 pandemic, many parents have decided that now is the time to plan for their family’s future.
Another great reason to tackle life insurance: The sooner you check this off your list, the better price you’re likely to get.
You might be surprised to learn that other common new year’s resolutions often go hand-in-hand with getting life insurance, serving dual purposes.
Maybe you’re committing to running a few times a week to boost your cardiovascular health, or you’re adding meditation to your daily routine to reduce stress, or you’re following a nutrition plan to get more healthy foods into your family’s diet. Any of these could help you lock down a lower monthly life insurance premium.
And if your health previously scared you off from applying for life insurance, making healthy changes could open up your options.
“If you have had certain health conditions that disqualified you from getting insurance in the past and it's been a while—five years or more—you may qualify if the situation is now under control,” Santoriello says.
A new year is a fresh start. Whether you use this new beginning to create fun traditions with your kids, level up at work or reach a fitness milestone, the plans you make now could set your family up for a brighter future. And a financial goal like getting life insurance can help ensure it stays that way.
Fabric exists to help young families master their money. Our articles abide by strict editorial standards.
This material is designed to provide general information on the subjects covered. It is not, however, intended to provide specific financial advice or to serve as the basis for any decisions. Fabric Insurance Agency, LLC offers a mobile experience for people on-the-go who want an easy and fast way to purchase life insurance.
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Accidental Death Insurance policies (Form VL-ADH1 with state variations where applicable) and Term Life Insurance policies (Form ICC16-VLT, ICC19-VLT2, and CMP 0501 with state variations where applicable) are issued by Vantis Life Insurance Company (Vantis Life), Windsor, CT (all states except NY), and by The Penn Insurance and Annuity Company of New York (NY only). Coverage may not be available in all states. Issuance of coverage for Term Life Insurance is subject to underwriting review and approval. Please see a copy of the policy for the full terms, conditions and exclusions. Policy obligations are the sole responsibility of Vantis Life.
All sample pricing is based on a 25-year old F in Excellent health for the coverage amount shown. All samples are for a 10-year term policy, unless otherwise stated. Term Life Insurance policies (Form ICC16-VLT, ICC19-VLT2, and CMP 0501 with state variations where applicable) are issued by Vantis Life Insurance Company (Vantis Life), Windsor, CT. Coverage may not be available in all states. Issuance of coverage for Term Life Insurance is subject to underwriting review and approval. Please see a copy of the policy for the full terms, conditions and exclusions. Policy obligations are the sole responsibility of Vantis Life.
A.M. Best uses letter grades ranging from A++, the highest, to F, companies in liquidation. Vantis Life’s A+ (Superior) rating, which was reaffirmed in April 2020, ranks the second highest out of 16 rankings. An insurer’s financial strength rating represents an opinion by the issuing agency regarding the ability of an insurance company to meet its financial obligations to its policyholders and contract holders and not a statement of fact or recommendation to purchase, sell or hold any security, policy or contract. These ratings do not imply approval of our products and do not reflect any indication of their performance. For more information about a particular rating or rating agency, please visit the website of the relevant agency.
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