Get the app
Get the app

Join millions of investors on Stash

Investing, simplified

Start today with as little as $5
Get the app
Teach Me

A Quick Guide to Term Life Insurance (And Why You Need It)

April 25, 2019

2 min read

Purchasing life insurance seems like such an adult decision. But it can actually be an easy way to provide financial protection for your family. You can even buy insurance online in minutes now, with partners like Bestow.*

Let’s start with the basics.

What is life insurance, anyway?

A life insurance policy can provide a financial safety net for your dependents or loan cosigners.

Who are dependents?  Dependents are anyone that depends on you financially (your partner, kids, an elderly parent, younger sibling). A life insurance policy can help pay the bills if anything should happen to you.

What types of life insurance are there?

There are a few different types of life insurance, including term, universal and whole life, and variable life insurance. Each policy differs in regards to how long it covers you for (your entire life vs. a set period of time) or potential financial benefits in addition to your monthly premium. But all provide coverage in the event that something happens to you.

What is term life insurance, anyway?

It’s called term life insurance because it insures you over a particular period of time, and typically pays out upon your death.

Term life insurance may be a good option compared to whole life for those who are looking for an affordable way to obtain a policy that covers you for a set amount of time. Generally, this can be 10 years, 20 years, or more, depending on what you choose. Stash’s life insurance partner Bestow also offers affordable two-year term policies, which can be  a great way to lock in coverage now, while you figure out your longer-term needs.

I’m young and healthy. Do I really need life insurance?

If you’ve got dependents or loan cosigners, life insurance can be a good idea.

Here’s the positive news: The younger (and/or healthier) you are, the more affordable your life insurance is likely to be. Plus, you can lock in a good rate that will stay the same for the entire term, or time period, of your policy.

What can my dependents use the money for?

There are no restrictions on what the money can be used for. Your family can use the proceeds to cover funeral costs, mortgage payments, child care, and day-to-day living expenses. It can also help you settle unpaid medical bills or any tax debt that would ultimately be the responsibility of your co-signer.

Is it really expensive?

People generally tend to overestimate the cost of term life insurance. For example, a healthy 35-year-old could get $500,000 of coverage for 10 years for $26 a month, or $50,000 of coverage for two years, for just $3 a month from Bestow.

I like it, but I hate paperwork

You can get a term life insurance quote online in seconds and apply in minutes for an instant decision.

Like what you hear or ready to apply? Click here to learn more from our partner Bestow.

Protect your people in minutes.

Learn more from our partner Bestow.

Get a quote

By Stash Team

Disclosure: Stash is a paid marketing partner of Bestow. All content herein is for informational and educational purposes only.

Investment Profile

Bonds Worldwide

An International Bond ETF on Stash

Learn more
Explore more articlesChoose a topic to learn more about
Technology Careers politics social media budgeting

This material has been distributed for informational and educational purposes only, represents an assessment of the market environment as of the date of publication, is subject to change without notice, and is not intended as investment, legal, accounting, or tax advice or opinion. Stash assumes no obligation to provide notifications of changes in any factors that could affect the information provided. This information should not be relied upon by the reader as research or investment advice regarding any issuer or security in particular. The strategies discussed are strictly for illustrative and educational purposes and should not be construed as a recommendation to purchase or sell, or an offer to sell or a solicitation of an offer to buy any security. There is no guarantee that any strategies discussed will be effective.

Furthermore, the information presented does not take into consideration commissions, tax implications, or other transactional costs, which may significantly affect the economic consequences of a given strategy or investment decision. This information is not intended as a recommendation to invest in any particular asset class or strategy or as a promise of future performance. There is no guarantee that any investment strategy will work under all market conditions or is suitable for all investors. Each investor should evaluate their ability to invest long term, especially during periods of downturn in the market. Investors should not substitute these materials for professional services, and should seek advice from an independent advisor before acting on any information presented. Before investing, please carefully consider your willingness to take on risk and your financial ability to afford investment losses when deciding how much individual security exposure to have in your investment portfolio.

Past performance does not guarantee future results. There is a potential for loss as well as gain in investing. Stash does not represent in any manner that the circumstances described herein will result in any particular outcome. While the data and analysis Stash uses from third party sources is believed to be reliable, Stash does not guarantee the accuracy of such information. Nothing in this article should be considered as a solicitation or offer, or recommendation, to buy or sell any particular security or investment product or to engage in any investment strategy. No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission. Stash does not provide personalized financial planning to investors, such as estate, tax, or retirement planning. Investment advisory services are only provided to investors who become Stash Clients pursuant to a written Advisory Agreement. For more information please visit www.stashinvest.com/disclosures.