common life insurance mistakes

Best Life Insurance for 52-Year-Olds: How Much Life Insurance Do You Actually Need?

Today in our 50s series, we are going to focus on age 52. If you are looking for a policy at this – or any – age, you should take the time to carefully consider how much life insurance you actually need. 

Millions of Americans shopping for a life insurance policy face confusion as to how large their policy should actually be. The dilemma: if you get too-small of a policy, you leave your family unprotected; if the policy is too large, you will be paying more in premiums and your family may not need the whole death benefit. 

The premium point is a big one: you’ve chosen term life insurance for the very reason that you do not want to pay the high premiums of whole life insurance.

Additionally, the age of 52 is an interesting one for purchasing a life insurance policy. 

Most individuals purchase insurance in their 20s and 30s, when they settle down and begin to start a family. By your early fifties, your children are most likely financially independents and you may have accumulated enough assets to care for yourself.

In this article, we’ll dissect the process of calculating how much life insurance you need, and we will look at some examples of what individuals in your age range can expect to pay for certain policy sizes. 

How to Determine Your Life Insurance Needs

Online, you may have encountered insurance calculators t help you make your decision; however these calculators are of no use if you haven’t already sat down and thought about all of your expenses. 

In order to figure out how much your spouse, partner or loved ones might need when you pass away, you will need to carefully evaluate the following factors:

  • Your current income. If you are the sole breadwinner, or if your family relies heavily on your income to stay afloat, you will want to calculate your income for a set period of time to help them get back on their feet should you pass away. This doesn’t need to be for life, just until they regain their financial footing. We recommend calculating anywhere from 1 to 5 years out, then adding in an extra year’s salary to account for inflation. This can be one of the most confusing parts of calculating your life insurance, so you and your loved ones should sit down with your agent or a financial adviser to help you figure out the best amount. 
  • Future Expenses. In addition to your income, you should think about future expenses. For most policyholders, this includes caring for children; however, at the age of 52, your children have more likely grown, flown the coop,and are beginning families of their own. You can always set up an inheritance within your policy for your loved ones, even if they are already grown. Don’t forget to include the cost of a funeral or any potential medical expenses!
  • Who to insure. This is an interesting calculation for most people; your policy is supposed to cover your family’s financial future, so who should your insurance cover. At the age of 52, a joint insurance policy may no longer be necessary. If both of your incomes are necessary to meet your current expenses, you may want to insure your spouse or partner. 
  • Current debts. Again: this is going to vary from person to person, particularly after the age of fifty. If you have a mortgage, credit card debt, student loans or medical expenses, you want to be certain to calculate those into your policy size. This is because, once you pass away, the responsibility of covering your debt falls to your loved ones. Don’t forget to add the cost of interest to any loans you may have!

How Much Will All This Cost Me?

We understand that these factors are a lot to consider. You may even be tempted to get the largest policy you can and to be done with it. 

We recommend being as accurate as possible, because it will save you money in premiums. Let’s take a look at what a man and a woman can reasonably expect to pay at a Standard rating for a few common policy sizes:

Life Insurance rates for a 52 year old Female Preferred Non-Smoker (with exam)

Face Amount 10 year 15 year 20 year

$250k $28 $34 $44

$500k $50 $62 $81

$750k $74 $89 $117

$1 million               $90             $115               $153

Life Insurance rates for a 52 year old Female Standard Non-Smoker (with exam)

Face Amount 10 year 15 year 20 year

$250k $42 $53 $68

$500k $72 $99 $130

$750k $115 $145 $191

$1 million                          $140               $184 $245

Let’s look at these same policy sizes for Preferred ratings:

Life Insurance rates for a 52 year old Male Standard Non-Smoker (with exam):

Face Amount 10 year 15 year 20 year

$250k $57 $73 $93

$500k $104 $138 $178

$750k $154 $203 $263

$1 million $194 $256 $338

Life Insurance rates for a 52 year old Female Preferred Non-Smoker (with exam)

Face Amount 10 year 15 year 20 year

$250k $28 $34 $44

$500k $50 $62 $81

$750k $74 $89 $117

$1 million               $90               $115 $153

Accuracy is important when calculating policy size, because it can save you anywhere from an extra $50 to an extra $100/month. For a 20-year policy, these savings range from $1,000 to $2,000!

Life Insurance Is An Important Financial Decision

Life insurance is the cornerstone for a strong financial plan, but it is also so much more than that. Life insurance shows your loved ones that you are prepared to financially protect them, even after you’re gone.

Figuring out which policy size is best for your unique situation is a complex process, which is why you should always take the time to sit down with a trusted financial adviser or a life insurance agent. You should take into account your current budget as well as your future financial needs, in order to find the policy size that will protect your family best.  

Give us a call with your questions and concerns, and let us help you figure out the policy size to suit your needs.