While life insurance may not be a thrilling purchase, Gregory Karp of Spending Smart said it is a fundamental part of financial planning, so it is shocking that ownership of policies is at a 50-year low in the United States.
"The economic downturn undoubtedly shifted Americans' focus away from life insurance to competing priorities for household money, such as putting food on the table," Karp said. "Still, half of U.S. households concede they need more life insurance, the highest level ever found in a LIMRA survey, which is released every six years."
Karp said about seven in 10 American households with children younger than 18 are the ones who need life insurance the most and said they would be in trouble if the breadwinner died. For people who are 30 years old, a $250,000 20-year life insurance police can be bought for $3 a week or about $158 per year, an affordable amount that could make life much easier for a family after a death.
A 2010 LIMRA survey said four in 10 households would be in trouble if their primary breadwinner passed away. This is one of the reasons life insurance is a must for families with dependents or children that need to be taken care of no matter what.