The good news you’re still young. The bad news is those weird pains that happen as you age have probably started. But since those do not have any affect on life insurance, your rates can be nearly as low as what you would get in your 20s. Life insurance for a 33 year old (or anytime in your 30s) is still cheap.
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Quick Links (Click below to jump to a section):
- How to save money
- Sample rates
- Permanent life insurance
- No exam life insurance
- Return of premium – how it works
How to Save Money on Life Insurance for a 33 Year Old
Saving money is pretty easy with a little research. Your insurance agent should be able to help you out as well. Although it’s always smart to do a little information gathering on your own first.
Doing your research on this step will not only save you money in the long run, but time now.
Knowing Exact Numbers
The basis of all money saving in life insurance is knowing exactly how much you need. You will see recommendations for amounts anywhere from 2x your annual income to 20x. Not helpful, right?
A Life Insurance Needs Calculator will tell you exactly how much you need. An interactive one will let you tweak the numbers as well. For example, if you are planning on having 3 kids, but currently have 2, you can run numbers for both scenarios.
Flights Not Pints – Don’t Pigeonhole Yourself Into One Option
It’s increasingly common to see craft breweries in the country (or bars focused on microbrews) offering flights. A flight is 4-6 smaller glasses of beer usually carried on a paddle to prevent spills. This way you can try a variety of beers instead of drinking only one.
This is similar to getting more than one life insurance policy to cover different needs. Instead of a single $500,000 policy for 30 years. You could get a $300,000 policy for 30 years to cover the mortgage. Then layer on $100,000 for 20 years to cover college tuition for each child.
Instead of just getting the one thing that works. You can cover a variety of options and have the best of everything.
Term versus Permanent Life Insurance for a 33 Year Old
Term insurance is always cheaper. It’s simple. Straightforward. Your policy provides a set amount of money for a set amount of time. Because there is no guaranteed payout, insurance companies offer term insurance at much lower rates.
Permanent life insurance covers you until age 121. So it’s doubtful that you will outlive it. Meaning the insurance company will have to pay your beneficiaries someday. That alone makes it more costly for the insurance company. Even before you add all the other benefits.
Talking to an Independent Agent
Independent agents and captive agents both have the same insurance license from the state. The difference is in the products they can offer you.
A captive agent can only offer products from one company. An independent agent can offer the products of many. An independent agent can save you time and money by shopping the market for you. You may end up deciding to work with a captive agent. If you talk with an independent one, you will have the rates of dozens of companies available for you to choose from.
Sample Rates for Both Men and Women – Age 33
These are what your rates for different term lengths and benefit amounts might look like. These rates reflect someone who is in good health with little family history of illness.
Life Insurance for a 33 Year Old Male – Preferred Plus – Non-smoker – Monthly Rates
|10 Year Term||$7.18||$9.62||$14.00||$21.79|
|20 Year Term||$9.38||$12.91||$20.56||$36.28|
|30 Year Term||$13.39||$21.11||$35.88||$65.19|
Life Insurance for a 33 Year Old Female – Preferred Plus – Non-smoker – Monthly Rates
|10 Year Term||$6.92||$8.91||$12.66||$19.31|
|20 Year Term||$8.70||$11.48||$17.72||$30.89|
|30 Year Term||$11.81||$17.83||$29.97||$53.33|
If you’re on the fence, you can compare what your rates may be now to what they may look like next year, at age 34.
Permanent Life Insurance
Permanent insurance can be a good option for many families. Some families want to make sure there is something going to their heirs. Others aren’t sure whether they will be in a financial position to come up with the cash for burial.
There are other advantages as well to permanent insurance. Most of them have a cash value accumulation feature. This means that as you hold on to your policy you have an amount on hand that you can borrow from. Money that makes it easy for a down payment on a bigger house. Other people use it to fund their annual vacation or pay off surprise medical bills.
We recommend term for most people. It’s much more cost effective for the majority of families. Whole life insurance can be fantastic for families with higher incomes to support the premiums, but we believe that you should never feel your life insurance premiums are a burden.
No Exam Life Insurance for a 33 Year Old
This is easy. The younger you are, the more no exam options you have. Some of them aren’t even that expensive.
In the old days, a no exam life insurance policy was many times the price of the same policy with an exam. Often called a guaranteed issue policy. Meaning they will offer you a policy at whatever price they think is appropriate. Since people try to cheat the system by skipping the exam, guaranteed issue policies were much more expensive.
Now many of these options are affordable for normal people. No exam policies can be issued by several companies up to age 56. Companies like SBLI are offering these options because they realize that a perfectly insurable person might just be too busy.
However, if saving money is your goal, we recommend spending the time on the exam. The lowest priced options always require the medical exam. You only have to do it once. Then it’s over and done with.
Return of Premium – How it Works
So what happens when the term ends? This is one of the first questions we get about term life insurance. Normally, you have the option to renew. You could also either shop for a different policy or let it expire.
A term life insurance policy with a return of premium rider gives back most of the premiums you paid at the end of the term. Sometimes you get everything back. That part depends on the company.
It’s difficult to say whether this is good for you or not. The concept is fantastic. But crunching the numbers can sometimes tell a different story.
When you consider adding a return of premium rider on a policy, you should consider the following:
- Term length
- Percent returned
- Your diligence about retirement contributions
- Your investing habits and options
If you take out a 30 year term and get 100% of your premiums back, that’s a nice gift to yourself. If the return of premium rider doubles your premiums, would it be better to invest that money elsewhere? 30 years is a lot of time to build up that compound interest.
On the other hand, if you aren’t in the habit of investing much, forcing yourself to save that money could be a huge benefit to you 30 years down the line.
Return of Premium Rates for Men – Preferred Plus – Non-Smoker – Monthly
|20 Year Term||$19.92||$40.67||$75.26||$144.42|
|30 Year Term||$18.88||$38.06||$70.04||$133.98|
Return of Premium Rates for Women – Preferred Plus – Non-Smoker – Monthly
|20 Year Term||$16.79||$32.84||$59.60||$133.10|
|30 Year Term||$15.83||$30.45||$54.81||$103.53|
You can see that the rates are nearly double that of policies without a return of premium rider. Here is the interesting thing. Companies price their 30 year term ROP policies lower in order to entice people to pick the longer term. That’s because they have an extra 10 years to try and make a profit on your premiums before they return them to you.
How Abrams Insurance Can Help
At Abrams insurance, our independent agents work for you. Never for the insurance company. We have access to 70 of the best rated insurance companies in the nation. Which means if we think one of them isn’t treating you fairly, we can find another one with ease.
We promise to keep at it until we find a policy that will protect your family without pinching your wallet.
Looking for sample rates for different ages? Start here for information on how to save money on life insurance at any age.
Give us a call at 858-703-6178 to find what is right for your family. We are here for you. There is never any obligation to buy.