Congratulations! You are at a stage in your life where you have a reason to buy life insurance. That usually boils down to getting married, having children, or buying a home. Well done!
The good news is that life insurance for a 32 year old is still comparatively inexpensive compared to waiting another few years. (See other rates for life insurance in your 30s.) Barring any pre-existing medical conditions (which we’ll cover), you should qualify for reasonable rates.
Life insurance can get as low as $7 - $8 a month if you're in good health. It will all depend on your health, the type of insurance, and the amount of life insurance you're looking for.
Save money (and avoid common pitfalls) by using the steps below. You can also get an idea right now of what your rates might be by using the Instant Quotes tool on your left. (It's up top if you're on mobile.)
Steps to Save Money on Life Insurance for a 32 Year Old
Beyond buying life insurance yesterday when you were younger, there are several ways to ensure that you don’t pay a cent more than necessary for life insurance. Not all of these may apply to every situation. So choose the ones that make sense for your family.
Calculate Exactly How Much Life Insurance You Need
Don’t let anyone tell you that you need X times your annual income in life insurance. If you have two people who both make $50,000 annually, one has kids, the other doesn’t, they will need different amounts of life insurance.
Instead, use a life insurance needs calculator to calculate precisely how much life insurance you need. That way you won’t buy too much and waste money. Neither will you buy too little and leave your family in financial trouble.
Don’t Over-buy In Expectation
If you and your spouse are talking about having another child or buying a bigger house, don’t purchase more life insurance in anticipation of that event. You don’t need it right now, so don’t spend the money on it.
You can always layer on another policy to the one you have, which brings us to the next tip.
Layer Policies Instead of Buying One Huge One
If you want your life insurance policy to cover multiple reasons for buying, it will save you money to purchase a couple of smaller policies than one large one for the longest amount of time.
For example, if you want a policy to cover your children until adulthood and a policy to cover your mortgage so your spouse can stay in the family home, don’t get one enormous 30-year term. You’ll save more money each month if you get a policy for however long you want to cover your children for. Most people get 20-year or 25-year terms to last until they finish their education. Then you can take out a separate 30-year term policy to cover your mortgage.
Most life insurance companies will also allow results from your life insurance medical exam for 6 months. Which means you can use one medical exam for two or more policies within that window.
Take the Medical Exam
No-exam policies are more convenient. No one will argue that. However, the more information your insurance company has on you, the less they need to charge to cover the unknowns of underwriting.
Look at it from the insurance company’s point of view. Why would someone not want to take the medical exam? It’s inconvenient, sure. But a small percentage of people will also try to hide medical conditions that will cause their rates to increase. The insurance company has to compensate for this fraud by charging everyone more for the no-exam policies.
There are also ways to boost the results of your medical exam if you take a little time to prepare.
List Your Reasons for Buying Life Insurance, and Stick to Them
When you start your comparison shopping, write down why you’re buying life insurance. Those reasons, coupled with the life insurance needs calculator will let you stick to your goals. If you happen across something to add that seems like a good idea, check your reason list. If it doesn’t match, you might be paying more than you need to.
Independent Agents Can Shop the Market for You, Captive Agents Can’t
Independent life insurance agents aren’t tied to any one company. They work with dozens out of the 850+ operating in the United States. That’s a lot of research for you to do if you were to call up each company to get rates. Independent agents can take a look at what you’re looking for, any relevant medical conditions, and budget to pick the best few for you in your price range.
Captive agents work for a life insurance company. They can only sell the products from that one company. They might have dozens of products, but if their underwriting guidelines don’t mesh well with your situation, you’ll be paying too much.
Term Life Insurance is Cheaper Than Permanent
Term life insurance is simple. You might have some options for riders, but in most cases, it’s a death benefit only. That’s it. Because it isn’t stuffed full of extra features, and it only lasts for X years, it’s much, much cheaper.
Permanent insurance, on the other hand, is more expensive, but it also serves an important purpose for many families. Permanent insurance (such as whole life or universal life) lasts until age 121. Families will use it to offset the costs associated with passing on an estate. That could be paying off any debts, estate taxes, or leaving something behind for a spouse or heirs.
More on permanent life insurance later.
Term Life Insurance Rates for a 32 Year Old Man
The monthly rates below reflect a relatively healthy man who doesn't smoke. If you are in great health, you might pay even less. If you aren't sure, take a look at the Instant Quotes tool on your left (top if you're on mobile) to get an idea of what your rates might be.
Term Life Insurance Rates for a 32 Year Old Woman
This follow set of monthly rates reflect a moderately healthy 32 year old woman who doesn't smoke. Again, depending on your health, your rates might be different.
Permanent Life Insurance at Age 32
Permanent life insurance, as mentioned before, is an umbrella term for life insurance policies that last your lifetime. Universal life and whole life are two examples. Although keep in mind that they do mature at age 121. However, that has not presented any issues yet.
Permanent policies have a death benefit, like term insurance. They also have a cash value accumulation portion. This builds up over the life of your policy as you pay your premiums.
You can use the cash value as a no-questions-asked loan for any reason you want. We have seen everything from paying off unexpected medical bills to annual vacations. The interest rates are low compared to most banks, although they vary somewhat by company.
Using life insurance along with your 401K can be an excellent way to prepare for retirement.
Quick Tip: Put enough in your 401K to get the company match. Anything you can save above the match - consider putting into a life insurance policy. The money in your policy can be accessed tax-free and this money is protected from stock market risk.
The insurance company is holding your death benefit as collateral, so if you pass away before paying back the loan in full, they withhold that amount of your death benefit from your beneficiaries.
There are different types of permanent life insurance policies which have different effects on how the cash value grows, some more closely adhere to the ups and downs of the stock market. Others are more stable, growing slowly on good years and still growing in bad years.
The type of permanent policy that would work best for your family depends on your risk tolerance.
No-Exam Life Insurance
No-exam life insurance is a little more expensive than traditional life insurance but has dropped sharply in price in the last 15 years. More people want the convenience, and more companies are willing to provide it. That leads to more competition between companies for your business and lower prices.
The other part of no-exam or no-medical life insurance is that the death benefit amounts are lower than traditional policies. Insurance companies don’t want to be on the hook for huge sums when there are still unknowns about the person they are insuring. Most no-exam companies limit policies to $250,000 benefits. There is a handful who will offer benefits from $500,000 to $1,000,000, but they’re few and far between.
Life Insurance with Pre-existing Medical Conditions
Pre-existing medical conditions can quickly make your life insurance application process more complicated. But it’s not impossible.
The best thing you can do to ensure that you get the best policy at the lowest rates is to be upfront with your life insurance agent. That way your agent can quickly eliminate the companies who overcharge for your condition.
When you call or email, have the following list ready:
- Disease/Disorder/Condition name
- Date of diagnosis
- Any surgeries and dates
- Any hospitalizations and dates
- Results of most recent testing
Depending on what you have, the underwriter will need more specific information to make an assessment.
You can also ask your independent agent to pre-screen you with a few companies to see what a tentative underwriting class might be. This way, you can get an idea of how underwriting will go before going through the whole application process.
For more information, see our article on life insurance with pre-existing conditions. It has more detailed information on what to expect as well as a list of common conditions that we’ve seen and how underwriters tend to view them.
Conclusions on Life Insurance for a 32 Year Old
Save yourself money by not buying a cent more than you need for the express purposes you listed under why you're looking into life insurance. You can also save yourself time by using an independent agent to shop the market for you since they aren't tied to any one life insurance company.
How Abrams Insurance Solutions Can Help
We are an independent life insurance agency working with 70 of the top insurance companies in the country to match you with the best life insurance company for your family. We work for you and not an insurance company.
Because we are an independent agency, we know what you should be paying for insurance. So if an offer comes back higher than expected, we promise not to rest until we re-shop the market for you make sure that you are getting the lowest rates possible.
If you have any questions, reach out to one of our friendly advisors at 858-703-6178. We are happy to answer any questions, and there is never any obligation to buy.