A good place to start cutting costs is with your life insurance, says Byron Udell of Accuquote (www.accuquote.com), a life insurance quote service.
“Go for a 20- or even 30-year guaranteed level-term policy, because they’ll offer the longest protection, and year after year, the rate remains the same,” says Udell. “And with prices at the lowest level in years, now is the best time in history to buy term life insurance.”
Look for the best value, not necessarily the lowest price; coverage at least 10 times your annual income; policy features such as guaranteed premiums and convertibility (the ability to turn term life insurance into permanent coverage without evidence of good health); and company ratings. Also, consider policy updates when changes in marital status, kids and employment occur.
Avoid the lure of “come-on” rates. To qualify for the lowest premiums, known in the industry as Superman rates, you must meet strict health and lifestyle guidelines. Many people can’t. Be realistic about the rate classification you qualify for. “The goal is to find the best company, the best product and best price that’s right for your specific health and lifestyle profile,” says Udell.
An example of what you would pay: A $500,000, 20-year policy for a 40-year-old male, nonsmoker cost $995 annually three years ago. Today, the same policy costs $455. And today, people can get a 30-year guaranteed level premium term policy for the same price they used to pay for a 10-year policy.
