Birthdays are a personal new year -- a time to reflect on the past and make resolutions for the future. A time to be grateful for one more spin around the sun, and perhaps a little wistful as you trade 365 days of youth for 365 days of wisdom. Maybe you like to honor the occasion at home, with family and cake. Maybe you like to go out with your friends and drink champagne. Do you celebrate all month long, or try to bring as little attention to your birthday as possible? Do you love the excitement of birthday gifts, or do you prefer to use the day as a for your favorite cause?
The Icing on the Cake
Whatever your traditions are, there’s one item you may have left off the list of things you should think about before your next birthday rolls around: . We know, it’s not as much fun as making a dinner reservation at that place all the PTA moms have been trying to get into. It’s not as fun as ordering an opera creme cake from your favorite local bakery...although it may be a little more fun than the time your kids tried to bake your birthday cake by themselves and you had to scrub rainbow sprinkled batter off the kitchen ceiling. But since one of the biggest factors that affects life insurance rates is age, getting approved before your next birthday is typically a good way to ensure that your premiums are lower than they may be after another year passes you by.
Happy Half Birthday
Life insurance rates by age are calculated a little differently from company to company. Some life insurance companies determine your rate based on actual age, but many use “,” which means if it’s been more than six months since your last birthday, it's your upcoming age that they look at. The downside is that on paper, you might look a year older. The upside is that you get an excuse to acknowledge your half birthday for the first time since childhood...and once it’s been acknowledged, you might as well celebrate. Maybe with affordable life insurance and a cupcake.
Time After Time
The older you are, the higher the “happy birthday” hike in premiums may be. According to , life insurance rates increase annually by an average of 5% to 8% in your 40s and 9% to 12% each year if you’re over age 50...so there’s truly no better time than NOW to get covered.
Because life insurance premiums are typically fixed for the duration of the policy you purchase, getting approved before your next birthday (or half-birthday) doesn’t just mean potentially getting a better rate this year...it means keeping that better rate for perhaps 10, 20, or 30 years if you choose term life insurance...or, if you choose a whole life insurance policy, you may lock in that rate for life. So just like your “29th” birthday, you can keep celebrating your decision over and over again!