How to Choose a Term Life Insurance Policy Length

You’ve done your research about life insurance. You know you want to protect your family, and you’ve researched the difference between whole life and term life insurance. If you go with term life, how long should you have coverage?

That’s a hard question, like asking you to plan out the next 10, 20, or 30 years of your life, today.

But don’t worry. You don’t have to hurry out to the nearest psychic and ask them all the things. Choosing the right term just means planning out a few significant milestones.

Ask yourself the following questions:

  • How long do you have left on your mortgage?
  • When do you see yourself getting married?
  • When will your kids graduate high school or college?
  • How long until you’ll have enough retirement savings?

And if you don’t have those nailed down either, that’s okay too. We’re going to break down life insurance rates for several term lengths, such as 10, 20, and 30 years. Then, we’ll walk you through why you might choose one term over another. Armed with this info, you’ll be ready to choose the right term when you need it.

Alternatively, check out our Ladder life insurance review. Ladder offers a unique form of on-demand term life insurance you can adjust as you go. It could be the right call if choosing a term length makes your head spin.

Together, we’ve got this.


30-year term life insurance

A few companies offer 35- or 40-year policies, but most stop at 30-year policies. Because it’s one of the longest you can buy, a 30-year term life insurance policy is also one of the most expensive. Still, these policies cost less than permanent life.

Who might want 30-year term life

  • People matching coverage to a 30-year mortgage
  • Folks who want long-term coverage without permanent life insurance prices
  • People 35 or younger looking for coverage until they build their retirement savings

How much does 30-year term life insurance cost?

 

Sample monthly 30-year term life rates for men*

Age $250,000 $500,000 $1,000,000
20 $18 $31 $51
30 $20 $32 $57
40 $29 $52 $95
50 $71 $129 $249

*Sample rates generated from Clearlink partner data and are for illustration purposes only. Rates are for preferred health class and actual rates may vary. Data effective 3/18/19.

Sample monthly 30-year term life rates for women**

Age $250,000 $500,000 $1,000,000
20 $15 $23 $40
30 $17 $27 $46
40 $24 $42 $77
50 $53 $96 $182

**Sample rates generated from Clearlink partner data and are for illustration purposes only. Rates are for preferred health class and actual rates may vary. Data effective 3/18/19.


20-year term life insurance

While folks used to prefer 30-year policies, far more people choose 20-year terms these days. 20-year policies represent a nice, middle-of-the-road option that fit people in a variety of life stages. Because these policies are so popular, they also have a sweet price tag for the value.

Who might want 20-year term life

  • Folks with 20 years left on their mortgage
  • People who don’t want to pay 30-year term rates
  • Parents looking to protect young children while they grow up
  • People 45 or older who want coverage until retirement

How much does 20-year term life insurance cost?

 

Sample monthly 20-year term life rates for men*

Age $250,000 $500,000 $1,000,000
20 $13 $20 $32
30 $13 $20 $32
40 $18 $29 $52
50 $40 $73 $139
60 $110 $210 $394

*Sample rates generated from Clearlink partner data and are for illustration purposes only. Rates are for preferred health class and actual rates may vary. Data effective 3/18/19.

Sample monthly 20-year term life rates for women**

Age $250,000 $500,000 $1,000,000
20 $12 $17 $27
30 $12 $18 $26
40 $15 $25 $43
50 $31 $55 $101
60 $77 $139 $265

**Sample rates generated from Clearlink partner data and are for illustration purposes only. Rates are for preferred health class and actual rates may vary. Data effective 3/18/19.


10-year term life insurance

If you want the shortest, cheapest policy on an insurer’s menu, you’ve found it. A few insurers offer five-year terms, but they cost about the same as a 10-year policy, so most folks choose 10-year term life anyway.

Who might want 10-year term life

  • Folks with preexisting health conditions looking to shave down their life insurance costs.
  • Entrepreneurs insuring the lives of key partners for the sake of the business or a loan.
  • Older adults looking for final expense insurance.
  • Parents of teen or “tween” children.
  • People with just a few more years left on their mortgage.

How much does 10-year term life insurance cost?

 

Sample monthly 10-year term life rates for men*

Age $250,000 $500,000 $1,000,000
20 $10 $14 $21
30 $10 $14 $21
40 $12 $18 $28
50 $24 $41 $73
60 $60 $112 $211
70 $180 $331 $602

*Sample rates generated from Clearlink partner data and are for illustration purposes only. Rates are for preferred health class and actual rates may vary. Data effective 3/18/19.

Sample monthly 10-year term life rates for women**

Age $250,000 $500,000 $1,000,000
20 $9 $12 $18
30 $9 $12 $18
40 $11 $16 $25
50 $20 $35 $61
60 $42 $75 $138
70 $108 $199 $369

**Sample rates generated from Clearlink partner data and are for illustration purposes only. Rates are for preferred health class and actual rates may vary. Data effective 3/18/19.


Choosing a payout for term life insurance

In the tables above, you may have noticed monthly premiums can vary widely depending on the payout, or death benefit, you choose. The larger the payout, the higher your monthly premiums.

While that can be a huge motivator to get a smaller payout, it’s important to make sure your loved ones get a high enough payout if you die. If you skimp on coverage to save money, you undermine your purpose for getting coverage in the first place: taking care of your loved ones.

To choose a payout, consider your reasons for getting life insurance in the first place. Most folks want a policy for one or more of the following reasons:

  • Pay off their mortgage
  • Replace their income for a specific number of years, often until a spouse retires
  • Protect their children’s lifestyles and cover college tuition
  • Take care of burial expenses and income
  • Protect a business partnership or loan

Whatever your reasons for getting term life insurance, estimate how much each will cost. Consider that, plus a comfortable buffer to account for unexpected expenses that may pop up for your family down the line.

Of course, you could find out how much life insurance you need using our life insurance calculator. We’ll ask a few questions, perhaps get you thinking about things you hadn’t even considered, and spit out a recommendation. It takes only a few minutes, and you get to leave the math to us.

Choosing a term life insurance policy

Now that you know why you might choose a particular term and what that might cost, where do you go from here?

Learn more about riders and other add-ons

At this stage, folks usually want to know the best place to get a term life insurance policy. Every life insurance company offers something a little different. Insurers have different life insurance rider options (add-ons) that help you customize your policy, for example.

Learn more about how your health and age affect your rates

Of course, different companies will offer different pricing for the very same policy too. Some insurers offer great rates on life insurance for older adults, while others focus on great pricing for folks with preexisting health conditions.

Plenty of insurers even offer no exam life insurance. While these policies typically have shorter terms and cost more than exam required life insurance, they remain an excellent option if you think other companies would turn you down for health reasons.

The bottom line

So how do you choose the right company? By reading up on the best term life insurance companies to see which might feel like a good fit for you. Or, check out the best no exam life insurance companies or best life insurance companies for seniors if either of those fit your situation.

 


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