3 Life Insurance Myths You Can't Afford to Believe

Don't buy into misinformation, especially around something as important as life insurance.

Life insurance is one of those financial products that are not always so well understood. For one thing, there are different types of life insurance. And as a policy holder, you get to choose the amount of coverage you have, which can get confusing.

Compounding the problem is that there's a world of misinformation out there on life insurance. But it's important to get to the bottom of these common myths.

1. It's too expensive

Many people shy away from buying life insurance because they assume they won't be able to swing the cost of their premiums. But actually, you may be surprised at how reasonably priced some life insurance policies are -- that is, if you choose the right one.

When you buy life insurance, you can determine what death benefit that policy will entail. And you can bet that a life insurance policy with a $1.5 million death benefit will generally cost a lot more than one paying out a benefit of $250,000. If you don't overbuy insurance, you may not run into affordability issues.

It's also important to choose the right type of life insurance. Whole life insurance covers you on a permanent basis, but the premiums costs attached to it can be extraordinarily expensive. On the other hand, if you stick with term life insurance, your policy will only stay in place for a limited period of time. But you might spend significantly less on premiums.

2. I'm too young to need it

If you're in your 20s or early 30s, you might assume you don't have to bother with life insurance just yet. But your age shouldn't be a factor in that decision so much as your life circumstances.

If you're 28 years old, single, and have no one in your life who depends on you financially, then you may not need life insurance just yet. But if you're 28 with a spouse and child and are the sole breadwinner in your family, then you should absolutely look at getting life insurance so your loved ones are protected in case something happens to you.

3. I don't need insurance if I don't have kids

Many people are inspired to buy life insurance once children come into the mix. But even if you don't have kids, you might still need a life insurance policy.

Let's say you're in a child-free marriage and own a home jointly with your spouse. It may be the case that you need both of your incomes to afford the mortgage. And so putting life insurance in place could make it so your spouse is able to keep your home in the event of your passing.

There's a lot of bad information circulating on the internet about a host of financial products. But life insurance is one that tends to be really misrepresented. Rather than buy into these life insurance myths, take the time to read up on life insurance so you can make an informed decision on getting a policy.