Currently, more than 35% of the U.S. workforce consists of freelancers who contribute at least $1 trillion to the economy every year, as reported by Freelancers Union. Unfortunately, due to their inconsistent income, freelancers often face problems such as lack of access to affordable healthcare, lack of retirement planning, and insufficient savings. This is because the federal government views them as independent businesses, and hence, the U.S. labor laws do not protect them, according to USA.gov.
For financial stability as a freelancer, you need to manage your earnings well, make the most of high seasons, and purchase life insurance coverage. Here’s what you need to know about life insurance for freelancers.
Life Insurance Should Be a Priority
More than 50% of Americans have some type of life insurance coverage. While more than half of those without life insurance claim it is too expensive, 20% of them don’t think they need it, as published on Statista. Life insurance coverage should be your priority as a freelancer since it will come in handy for your loved ones when you die. This is because no employer or organization will step in to help your family financially or pay for your funeral expenses, and you may leave your family in financial turmoil.
Term Life Insurance Is Cheaper
Generally, term life insurance is way cheaper than whole life insurance. This is because it only provides coverage for a certain period, say, 20 years, and has fewer benefits than the whole life insurance. Being a freelancer, the term life insurance policy may be the next best option to choose if you are worried about paying huge premiums on the whole life policy. The good thing about term life policy is that you can renew it at the end of the term if you outlive it. Even so, the insurance company will most likely increase the premiums with age due to an increased risk.
You Can Pay Annual Premiums on Your Freelancer Insurance
According to the U.S. Bureau of Labor Statistics (BLS), an average full-time employed American works for about 44 hours per week. On the other hand, freelancers only work for less than 40 hours per week, although this may vary depending on job availability. Since you may go for many weeks without a job as a freelancer, you should take advantage of your peak seasons by accumulating as much money as you can and clearing off your debts. For example, the high season is the best time to pay your annual life insurance premiums. This will save you the recurrent costs that may come from paying monthly premiums. Additionally, most insurance companies offer discounts on annual premiums, and this will lower your freelancer insurance costs.
These are some of the things you should know about freelancer life insurance. Do you have additional questions about your life insurance coverage? If so, then contact the experts at Randy Jones Insurance Services in Pleasanton, California. Our dedicated team is eager to assist you with all your personal insurance needs today.
