Buying Life Insurance in Your 40s and 50s
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If someone depends on you financially, life insurance can be a good idea at any age.
Costs increase with age, so it's a good idea to lock in your rate as soon as you identify a need for coverage.
You can hold multiple insurance policies and ladder your coverage as your needs change.
If you’re in your 40s or 50s and considering a midlife life insurance policy, or if you have coverage but want more, there are plenty of options to choose from.
The best type of life insurance to get depends on your budget, health and goals. Your age is a factor in the price of your policy, so try to move quickly to compare life insurance quotes and make the choice that’s right for you.
Reasons to get life insurance in your 40s and 50s
Life insurance is a good idea at any age if people in your life depend on your income. That could mean a partner, kids, aging parents or employees of a business you own. If you die prematurely or unexpectedly, your financial dependents might struggle. Having a life insurance policy in place can ease that burden.
There are other reasons to buy life insurance at this age. The payout from your policy could help with:
Covering your funeral, burial or cremation costs. The median cost of a casket, funeral and burial was $8,300 in 2023.
Paying off debt, such as a mortgage or loan. The responsibility of loans could fall to your heirs, who may be unprepared to handle these expenses.
Leaving an inheritance. You may wish to leave a legacy for your children or grandchildren.
Contributing toward college tuition. If you haven't started a college savings account, life insurance could help provide funds for your children or grandchildren.
Supporting a cause. You can name a charity or other organization as a beneficiary on a life insurance policy.
» MORE: 5 reasons to get life insurance
How to choose the best life insurance for people over 40 or 50
There are two main types of life insurance: term life insurance, which expires after a set period of time (like 10, 20 or 30 years), and permanent life insurance, which typically lasts the rest of your life. Depending on the policy you pick, you may be able to customize your coverage with life insurance riders.
When you’re in the market for life insurance, consider these options:
Term life insurance is designed to cover the years people depend on your income. You can choose a term that will run out around the time your need for life insurance ends, such as when the kids move out or the house is paid off.
Whole life insurance builds cash value over time and usually last a lifetime, so it’s often used in estate or retirement planning. You can use whole life insurance to ensure your dependents receive a payout no matter when you die, or as a way to build up retirement funds after maxing out your 401(k) and other retirement savings accounts.
Universal life insurance is a type of permanent life insurance that offers flexible premiums and death benefits. The cash value also grows at a guaranteed interest rate, so you can expect predictable returns. Since universal life insurance allows you to adjust your coverage based on your needs over time, you’ll need to pay closer attention to your policy.
Group life insurance is free or low-cost coverage, usually offered as an employee benefit. The death benefit is typically worth a specific amount, like one year of your annual salary, and doesn’t require a medical exam.
Burial insurance is designed to cover the cost of a funeral and end-of-life expenses, so the death benefit is typically capped at low amounts. Policies are often “graded,” which means you might have less coverage for the first two years the policy is in effect. This type of whole life insurance may be a good value if you have underlying medical conditions that would disqualify you from other coverage types.
» MORE: Best life insurance companies
Costs of life insurance for those in middle age
The main factors that affect life insurance rates are age, health and lifestyle, which is why it’s important to buy a policy as soon as you identify a need for it. That way, you’ll be able to lock in the lowest rates possible.
Annual cost of term life insurance
Here are sample rates for a $500,000, 20-year term life insurance policy for nonsmoking applicants in excellent health. These prices reflect annual rates.
Age | Average annual rate for men | Average annual rate for women |
|---|---|---|
40 | $334 | $282 |
50 | $817 | $641 |
Source: Covr Financial Technologies. Lowest three rates for each age averaged. Data valid as of August 28, 2024. | ||
Annual cost of whole life insurance
The price of permanent coverage, such as whole life insurance, will typically be much higher than for term life. Part of the extra premium goes toward building cash value.
Here are sample rates for a $500,000 whole life insurance policy for nonsmoking applicants in excellent health. These prices reflect annual rates.
Age | Average annual rate for men | Average annual rate for women |
|---|---|---|
40 | $7,440 | $6,512 |
50 | $10,353 | $9,002 |
Source: Covr Financial Technologies. Lowest three rates for each age averaged. Data valid as of August 28, 2024. | ||
» MORE: Average life insurance rates
Best life insurance companies in your 40s and 50s
While you may qualify for a senior discount at some shops and restaurants as you enter your 50s, life insurance isn’t an area where you can expect a price reduction. Rates for new policies tend to increase with age.
Even if "senior citizen" status may be years away, NerdWallet's list of the best life insurance for seniors can help you narrow down your search if you're in your 40s and 50s. Be sure to compare quotes as premiums and availability vary based on your age, health and other individual factors.
Insurer | NerdWallet rating |
|---|---|
NerdWallet rates insurers at the company level, not the policy level. This means these star ratings reflect the company's life insurance offering as a whole, and not its policies for seniors specifically. | |
Buying extra life insurance coverage in your 40s or 50s
Perhaps you already have coverage, whether it’s group life insurance through your employer or a policy you took out years ago. But maybe you’ve reached a point where you wonder whether you have enough.
You can own more than one life insurance policy. This is helpful if you find yourself taking on additional financial obligations, such as a mortgage or care of aging parents. You can also "ladder" multiple life insurance policies in a way that makes it more affordable than buying a single, larger policy.
There are various ways to figure out how much life insurance you need, but the general idea is to calculate your long-term financial obligations and subtract the value of your assets. Life insurance helps pay for the remainder in case of your death.
Use our tool below to estimate your life insurance needs.
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