5 Indisputable Facts about Buying Life Insurance in Your Thirties

Home » Blog » Types of Life Insurance » 5 Indisputable Facts about Buying Life Insurance in Your Thirties
  • life insurance 30 year old

There is one undeniable fact about buying life insurance in your thirties: you would pay a lot less than if you were in your forties, fifties, or sixties. Have you ever heard the saying, “Don’t buy something unless you need it!”? You can apply that to almost everything in your life, except purchasing life insurance.

I get at least ten calls a week from people who were diagnosed with a terminal illness and are looking to buy life insurance right now. The sad truth is, at that point, it’s too late. They might be able to buy a guaranteed issue policy, but this will not help with the mortgage, college for children, and income for the widowed spouse.

Buying life insurance in your thirties may be the best thing you can do, even if you don’t need it right now. In this article, I will be looking at life insurance rates and policy types for people who are thirty years old.

Related: 5 offbeat ways to save money on life insurance

I’m Only 30. Should I Get Life Insurance?

For most, arriving at the age of 30 marks a significant milestone. Many have already finished college, aren’t living with their parents, and are thinking about the next events in life: marriage, family, and buying a house. It seems that this is the turning point for the majority. They are letting another person into their lives and have started thinking about what would happen to that person if they were to pass away unexpectedly.

Buying life insurance has nothing to do with you. It has to do with how your loved ones will survive after you are gone and can no longer provide. Regardless of your age, if someone depends on you financially, you need life insurance. It’s not only smart, but it’s a great display of unselfishness because it’s about them and not you.

1. Do You Like Paying Less for Insurance?

Age isn’t the only factor the life insurance carrier uses to calculate your rates, but it’s a significant one. They also determine your rates by gender, health history, driving records, and medication usage among many others. If you know you need life insurance because you have taken out a business loan and need key person coverage, had your first child, or bought your first home, get coverage while you are young. Not only will you pay less, you will have peace of mind earlier rather than later in life.

Related: Why do you get conflicting life insurance rates?

2. You Can Get up to One-Million-Dollar Life Insurance Without an Exam

No-exam life insurance is a popular option among the young and healthy. As the name implies, you will not undergo an exam as part of the underwriting process. Instead, the underwriter will conduct a phone interview and collect data from prescription reports, MIB (Medical Information Bureau), and other publicly available data to make the underwriting decision.

A decision takes anywhere from a few minutes to a few days. Most companies offer up to $500,000 in no-exam policies, but a few companies, such as Banner Life, offer up to $1,000,000 in coverage for those between the ages 20 and 40 with no added cost. Hence, you will pay the same whether you take an exam or not, and this is reserved for the healthiest and youngest.

When you apply in your forties and beyond, the lower the face amount you can purchase and the more you would spend. It’s a huge incentive to get a large policy, spend less on it, and skip the exam. You could still apply in your forties for a million-dollar life insurance, but you will have to take the exam.

3. You Are Less Likely to Have Pre-Existing Conditions

Truth be told, the older you become, the more prone you are to develop pre-existing medical conditions. If you pose a higher risk to the carrier by having any health issues, the higher rates you should expect to pay, and if the risk is too high, the carrier will deny your application. Most thirty-year-olds are in a decent to excellent health condition, so the chances for a rate increase or denials are slim.

4. Income Factor Table

Health history isn’t the only factor the underwriter is looking for when you apply for coverage. Your earned income is another piece they consider when underwriting your coverage. The income factor guide is a predetermined table the carrier uses to estimate the maximum coverage they can offer, based on the applicant’s age in relation to the earned income.

The idea has its roots in the fact that the younger you are, the more coverage you need (student loans, mortgage, children), and the older you are, the less you need (the mortgage is paid off, the kids are grown up and are no longer dependent on you financially).

If you buy life insurance in your thirties, you can get up to 35 times your yearly income. For instance, if you make $100,000 per year, you could buy up to $3.5 million in coverage. In your forties, that factor is 25 times; fifties, 20 times, etc. The longer you wait to buy life insurance, the less you will be able to buy.

Related: Can I buy multiple life insurance policies?

5. Cost of Waiting—It Doesn’t Get Cheaper

Yes, I get it. Buying life insurance isn’t as exciting as purchasing a new technological gadget or a new car. Since we don’t use it, it’s hard for us to justify the cost. One of my mentors used to say, “Life insurance is the worst investment you can make until you need it, but when you do, you can no longer get it.” This is one of the reasons some of us procrastinate obtaining life insurance.

The longer you wait, the more it will cost you. It’s as simple as that. For instance, a 30-year-old male can buy a 30-year term $500,000 in coverage for $32 per month. If he bought the plan while in his forties, he would pay $52 per month; in his fifties, $125 per month. For some things, it makes sense to wait to buy, but life insurance isn’t one of those things.

Which Type of Coverage Is Available for 30-Year-Olds

Life insurance comes in two main categories: temporary and permanent coverage. Let’s take a look at the differences between the two with sample rates.

Temporary Coverage for a 30-Year-Old

As the name implies, temporary protection lasts for a specific period. There are two types of term life insurance: Fully underwritten plan (requires an exam) and no-exam life insurance. Let’s review more.

Term Life Insurance

Term life insurance is coverage that will not break your bank. It is also referred as “pure insurance” because you only pay for coverage without the added bells and whistles. Cash value or tax-deferred investment options aren’t your cup of tea. Instead, you buy protection for a specific length, usually between 10 to 30 years, with the 20-year term being the most common period.

If you die during that time, your beneficiary will collect the death benefit (also called face amount). If not, at the end of your initial term period, you may convert your term coverage to whole life without proving eligibility for coverage, renew the policy on an annual basis, or drop it.

Term Life Sample Monthly Rates

30-Year Level Term Male

 AGE$100,000$250,000$500,000$1,0000,000
 30$11.90$19.78$32.29$57.36
 31$12.34$20.21$33.24$59.11
 32$12.51$20.64$34.22$60.92
 33$12.60$21.28$35.17$61.49
 34$12.78$21.85$36.30$64.72
 35$12.86$22.30$37.39$66.50
 36$13.56$23.56$39.99$69.23
 37$14.44$24.94$42.57$76.11
 38$14.70$26.57$46.01$85.59
 39$15.05$28.44$49.45$92.55

20-Year Level Term Female

 AGE$100,000$250,000$500,000$1,0000,000
 30$10.50$17.06$27.19$42.00
 31$10.76$17.24$27.86$49.05
 32$10.94$17.72$28.72$50.79
 33$10.94$18.16$29.58$52.50
 34$10.94$18.16$30.19$53.35
 35$11.73$19.28$31.44$54.25
 36$12.62$20.24$33.35$59.66
 37$13.30$21.20$35.17$64.71
 38$13.30$22.34$37.60$68.25
 39$13.48$23.56$39.90$69.13

No-Exam Life Insurance

Another popular option among individuals over 30 is term life without a medical exam. This coverage is identical to the traditional term (which requires an exam) except that no-exam coverage will not require an applicant to undergo an exam.

Instead, the data collection and phone interview are conducted by the carrier’s underwriter, and a decision is usually made between a few minutes and a few days. No-exam coverage has two major drawbacks: first, it costs more than a traditional term, and second, the maximum face value is one million dollars.

No-Exam Sample Monthly Rates

No-Exam 30-Year Term Male

 AGE$100,000$250,000$500,000$1,0000,000
 30$12.99$19.78$32.29$57.36
 31$13.17$20.21$33.24$59.11
 32$13.35$20.64$34.22$60.92
 33$13.54$21.28$35.17$61.49
 34$13.73$21.85$36.30$64.72
 35$13.93$22.30$37.39$66.65
 36$14.67$23.56$39.99$69.23
 37$15.24$24.94$42.57$76.11
 38$16.00$26.57$46.01$89.87
 39$16.94$28.29$49.45$96.75

No-Exam 30-Year Term Female

 AGE$100,000$250,000$500,000$1,0000,000
 30$11.52$16.78$27.19$47.16
 31$11.78$17.24$27.86$48.50
 32$11.80$17.72$28.72$50.22
 33$11.80$18.19$29.58$51.94
 34$11.89$18.74$30.44$53.66
 35$11.97$19.28$31.44$55.66
 36$12.62$20.24$33.35$59.66
 37$13.34$21.20$35.17$63.96
 38$14.11$22.34$37.60$68.37
 39$14.96$23.56$39.90$74.36

Permanent Coverage for a 30-Year-Old

Permanent coverage lasts for as long as the insured is alive. You will not need to worry that your coverage will expire, and you also build cash value that you may access in future years to get a loan or when you surrender your policy. It comes with a huge drawback: cost. It costs 5–15 times as much as term life does. For most,  that’s a big reason to avoid permanent coverage.

Most obligations aren’t permanent. The mortgage isn’t forever, and your children will leave the house someday. For most, term life insurance is the way to go. Agents and brokers love selling permanent policies because the commissions are high, and they get the renewals for many years to come. Make sure you select a broker who has your best interest at heart instead of their own.

Whole Life Insurance

Whole life insurance offers a guaranteed death benefit, level premium payment, and cash value accumulation. Each time you pay your premium payment, a portion of that amount goes towards the cost of insurance (COI) and the remainder earns a fixed interest rate and builds cash value which you can access in the future by taking out a loan or collecting it when you surrender the policy. The money grows on a tax-deferred basis.

Whole Life Sample Monthly Rates

Whole Life Male

 AGE$100,000$250,000$500,000$1,0000,000
 30$105.00$238.16$470.67$935.69
 31$108.41$246.85$488.07$970.49
 32$111.74$255.56$505.47$1,005.29
 33$115.15$264.70$523.74$1,041.83
 34$118.56$274.79$543.32$1,080.97
 35$121.98$284.93$564.20$1,122.73
 36$125.83$296.24$586.82$1,167.97
 37$129.68$308.20$610.74$1,215.83
 38$133.61$321.03$636.41$1,267.16
 39$137.46$334.21$662.94$1,320.23

Whole Life Female

 AGE$100,000$250,000$500,000$1,0000,000
 30$98.14$207.71$409.77$813.89
 31$101.44$215.33$425.00$844.34
 32$105.01$223.16$440.66$875.66
 33$108.66$230.99$456.32$906.98
 34$112.32$239.47$473.28$940.91
 35$115.97$248.60$491.55$977.45
 36$119.54$258.61$511.56$1,017.47
 37$123.02$296.05$532.44$1,059.22
 38$126.59$280.14$554.63$1,103.60
 39$130.33$291.67$577.68$1,149.71

Universal Life Insurance

Another permanent coverage called universal life or UL for short. Its primary purpose is flexibility. Flexibility to adjust your premium payment amount or skip it when applicable. Flexibility to increase or decrease your death benefit in the future.

Unlike whole life, you can fund your policy or pay more in earlier years, so later on in life, the cash value will pay your premium payment. At that point, you have fully funded coverage. For the one who is looking for more aggressive growth, they can choose Indexed or Variable Universal Life.

Guaranteed Universal Life

Guaranteed universal life (GUL) is a policy which lets you choose your coverage based on a specific age rather than a particular term. For instance, if you are in your thirties, the most extended term you could purchase is 30 years, which will take you into your sixties.

With GUL you can buy protection up to age 85, 90, 95, 100, 105, 100, or even 121. GUL doesn’t build any cash value because the premium you pay is only to keep the policy funded, without extra premium to grow the cash savings account.

Guaranteed Universal Life Sample Monthly Rates

GUL to 100 Male

 AGE$100,000$250,000$500,000$1,0000,000
 30$46.26$98.93$197.85$323.27
 31$47.78$101.76$203.51$333.49
 32$49.32$104.84$209.57$344.59
 33$50.94$108.02$216.04$356.10
 34$52.55$111.35$222.70$368.13
 35$54.18$114.90$229.80$380.93
 36$56.39$117.64$235.29$397.07
 37$58.68$120.59$241.18$414.28
 38$60.93$123.65$247.30$432.31
 39$62.15$126.89$253.78$451.37

GUL to 100 Female

 AGE$100,000$250,000$500,000$1,0000,000
 30$38.61$85.23$167.73$287.74
 31$39.74$87.57$172.42$296.26
 32$40.85$90.03$176.97$305.23
 33$41.91$92.60$181.32$314.59
 34$42.94$95.33$185.49$324.53
 35$43.93$98.21$189.47$335.01
 36$45.74$101.57$197.16$348.30
 37$47.59$105.07$205.03$362.20
 38$49.50$108.78$213.12$376.88
 39$51.45$112.61$221.40$392.06

*All rates quoted on this page are for a super-preferred healthy individual who does not use tobacco. Monthly rates are updated as of July 2018 and are subject to underwriting approval.*

Last Thought

In my opinion, term life insurance would be the best choice for most 30-year-old individuals. Its decreased cost and accelerated underwriting process make it a sensible choice for most. As mentioned above, buying life insurance will never be an exciting thing you post on Instagram for the world to see. It is only a demonstration of safety and security for the ones you love most should the unexpected happen to you.

Sure, money will never replace the deep sadness that results from losing a loved one, but it will sure give the beneficiary a chance to worry about other things besides money for years to come. You can use the quote engine on this page to run term life insurance quotes, or give us a call at 866-326-3053 for more complex policies such as universal life or whole life coverage.

Ready to Save 62% on Term Life?

Don’t get trapped dealing with just one company, compare 50+ at once!

Get Your Personalized Quote
2018-09-01T16:53:55+00:00July 28th, 2018|Categories: Types of Life Insurance|0 Comments

About the Author:

Ron is a licensed life & health insurance broker. He has two amazing rescued Pitbulls. He also enjoys real food, heavy squats, critical thinking, and reading.

Leave A Comment