When I became my parents' caregiver, spending less than $20 a month on life insurance was a no-brainer
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- When my parents were in their 80s, they moved in with me so that I could care for them. For the first time, I was responsible for other human beings.
- Then 33, I decided to get a 20-year term life insurance policy worth $100,000.
- Twenty years later, my husband and daughter are the beneficiaries of the policy (now worth $250,000) and I pay just $18 a month for the coverage. It's set to go up to $200 soon, though, and I'm not sure if I should spend that much.
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A day before I got on a plane for a recent weeklong international business trip, I sent my sister a text message. "Not to be overly morbid, but I have a life insurance policy with Company X. Paolo wouldn't know where to begin."
"Understood," she replied a minute or so later. "Hopefully info I don't need to know."
I hadn't thought of that policy for a while, other than being reminded of it when I noticed the monthly premium deducted from my bank account. But prior to the longest and longest-distance trip I'd taken away from my husband and young daughter, I figured I should make sure that someone besides me knew what paperwork to look for.
My Italian husband speaks English fairly well, but I'm not sure he'd be able to navigate grief, loss, and pursuing a death payout with a giant American insurer.
So, much like delegating to a loved one the responsibility of scattering the ashes, I put my sister in charge of chasing down the money should anything happen to me.
Why I bought a life insurance policy
Should anything happen to me. I first seriously considered that possibility when I became responsible for the lives of other human beings - and that's when I bought a term life insurance policy worth $100,000.
I was self-employed and shopping for health insurance when the salesperson, who had called on me at home, asked if I was interested in a life policy as well.
Two rooms away, I could hear the muffled tones of the TV in front of which my 80-year-old parents were seated - dozing, probably - in recliners.
They'd been living with me for about six months at that point, as they could no longer afford to maintain their own home or pay for assisted living.
I was 33, single, hustling to make a living as a freelance writer and editor, and increasingly feeling the weight of responsibility of caring for them. Should anything happen to me, what would happen to them?
A mouth swab later (to confirm that I was a non-smoker), and I was the holder of a $100,000, 20-year term life insurance policy that cost me $12 a month, automatically deducted from my checking account.
Within a few months, I increased the policy to $250,000, which changed my premium to $18 a month. That was still peanuts to pay for peace of mind and an abstract concept - my elderly parents outliving me - that I figured would never really become reality.
By the time I purchased that effortlessly cheap life insurance policy those many years ago, I'd already done some adult things. I was a homeowner twice over. I had pets. I'd made the decision to forge an unconventional career as a freelancer, and I was rocking it.
But buying that policy had more gravitas than any other of those big adulting moves I'd made. The realization that I was responsible for the well-being of other human beings, even if I was no longer around, meant that I had crossed the threshold to full-on mature adulthood - and there's been no turning back.
My life insurance premium is about to go way up
Fast forward 20 years, and my parents are no longer the beneficiaries of my life insurance policy. Now, it's my husband and young daughter.
A payout of $250,000 might not be that much in the grand scheme of things, nor would it assuage their grief - or my eternal guilt in the afterlife for abandoning them too soon. But it's enough to pay for college, pick up and move to another city, and provide a little bit of a soft landing after what I trust would be a devastating blow.
As is the rule with term life insurance policies, that attractively low premium comes with an expiration date. Next year, the premium will jump from its current $18 to just under $200 - I guess since the possibility of me actually dying, so abstract at 33, is a lot more plausible at 53.
That's the clincher with term life insurance - it works according to the laws of attrition, which are not in favor of the aging. It's cheap when you're young, and a lot more expensive when you hit middle age.
And if I cancel the policy now, it has no cash value (unlike whole life policies, which can have some payout if cancelled), so the $4,500 or so I've paid into it is gone in a poof.
It was easy to not think about an $18 monthly expense - less than half of what I pay for a gym membership or to get my nails done once a month. But $200 a month? We'll feel that, and my husband and I need to decide whether we'll maintain the policy or cancel it.
He doesn't like to talk about such things - too morbid for him. Yet people my age - including friends and relatives - drop dead of heart attacks or aneurysms; they get cancer and they have fatal car accidents.
That I get on planes and trains frequently and without my family only increases (marginally perhaps, but still) the odds that something actually could happen to me.
Is $200 too much to spend for my loved ones' security, and for my peace of mind? Where's the line between a strictly economic decision - for which the answer would surely be no - and a pragmatic and emotional one: How much is peace of mind actually worth?
I have all the questions and none of the answers, and I suppose we'll put off making a decision until the rate increase kicks in.
For the record, there's one thing I do know: Having a life insurance policy doesn't make me worry any less about the plane crashing.
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