Frugal Living and Buying Life Insurance


buying life insuranceThe essence of frugal living – for some – is to spend as little as humanly possible on things like food, bills and ‘luxuries’. In this case, you might not think that life insurance is very frugal – after all, it’s an extra payment you’ll have to make each month for something you might never end up using.

Others would argue, however, that the true spirit of frugality is getting the best value on the things you do buy.

If you have a mortgage or people depending on you for financial support, buying life insurance is a good frugal choice. If you don’t know how your loved ones would cope financially without you, it’s well worth putting a safety net in place.

A life insurance payout could help them keep up with monthly financial commitments and stay in their home. Depending on the size of the payout they could be as frugal as they liked with it – or they could splash out a little bit for a treat or holiday during an otherwise difficult time.

You don’t have to pay over the odds for your life insurance, either. For example, if you shop for life insurance through All About Money, you could find policies from as little as $8 or £5 per month.

It’s always worth comparing quotes and shopping around to help you find cheap life insurance.

If you find a good deal, you could safeguard your family’s future against a ‘worst case scenario’ for less than you thought – and what could be more frugal than that?

Readers: Do you agree that buying Life Insurance is a smart move financially?

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10 Responses to Frugal Living and Buying Life Insurance

  1. John S @ Frugal Rules 02/08/2013 at 9:53 am #

    I think life insurance is a great thing to purchase, especially if you have a younger family. A good thing to do is to buy it when you’re young so you can hopefully lock in some lower rates.

    • Paul 02/08/2013 at 10:33 pm #

      When you look at income replacement and funding college, life insurance is a must have for married couples with children. It would be tough to think about leaving a spouse and children in a situation where there was no life insurance policy to protect their standard of living.

  2. Midlife Finance 02/08/2013 at 10:00 am #

    I’m shopping around for life insurance. Trying to come up with a number isn’t easy.

    • Paul 02/08/2013 at 10:27 pm #

      If you have children the amount of life insurance that would be required is staggering. Talk to your insurance agent to have a life insurance analysis done. Once you have that you can decide what you can fit into your current budget and then increase the insurance coverage when you are able.

  3. John@MoneyPrinciple 02/08/2013 at 4:13 pm #

    We reduced our life insurance bill substantially (a) by changing the sort of cover to term cover, (b) by changing companies, (c) by reviewing what would actually be needed given any other insurances and the likely needs of the surviving partner. It seems cold but saved £hundreds a month.

    • Paul 02/08/2013 at 10:23 pm #

      I just talked to an insurance agent and found out I could save a couple hundred each year by dropping the full glass coverage on my auto policy and self insuring for that. Never knew how expensive the glass coverage really was!

  4. Sarah Park 02/09/2013 at 3:01 am #

    I don’t consider life insurance as an extra payment, but rather a savings. We never know what will happen to us in the future and we do not want to leave our families empty-handed. We just have to be wise enough in choosing the best life insurance that will perfectly fit for us.

    • Paul 02/09/2013 at 7:26 am #

      That may be true for whole life which builds equity over time but term is an expense.

  5. Tushar @ Everything Finance 02/09/2013 at 3:43 pm #

    Whether or not buying life insurance is worth it really depends on the family, but I think if you have kids and a mortgage – or even just a mortgage and a spouse – then it’s important to be covered, at least a little bit. While it may be another payment, it can only serve you well in the future, should something happen.

    • Paul 02/09/2013 at 5:22 pm #

      Agreed Tushar. Insurance is for your dependents or business successors and is generally not needed if you do not have dependents.

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