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How much does term life insurance cost? Here's 5 ways you can potentially save up for it

5 everyday items that cost more than term life insurance

The purpose of life insurance is to protect your loved ones in the event that you pass away unexpectedly. However, you may think now is not the right time to purchase a life policy because the monthly premiums cost too much. What you might not realise, though, is that a basic term life insurance premium is far more affordable than some of our everyday expenses.

 

How much term life insurance cost can vary depending on your individual circumstances, such as policy term and sum insured, age, gender, smoking status and health etc. Premiums for life insurance are typically lower the younger you are at the time of purchase and rise considerably as you aged – at an average rate of about 8% to 10%1 every year. This is because you are likely to be healthier when you are younger and less likely to make a claim from the insurance company. Locking in an insurance premium that is lower at a younger age also allows for spare cash for other uses. In the case of a healthy 30 years old, getting Manulife’s ManuProtect Term (II) for a term of 35 years old with a sum insured of S$500,000 would cost S$50.95 per month for males and S$36.22 per month for females2!

Using the above example and looking at 5 everyday items that we are spending much more on, these monthly premiums seem to be more affordable in comparison! With some adjustments to your everyday spending habits, you could purchase a term life insurance policy and getting a peace of mind.

Cut back on barista coffee

A cup of coffee isn’t very expensive and is a ubiquitous part of most people’s daily routine. But if you are taking your coffee away from Starbucks or other cafes in Singapore, it’s going to set you back an average of S$5 to S$6 every day. If you purchase 1 cup of coffee at S$5 every day, the monthly cost of coffee would add up to S$150! That is 230% to 377% more than the monthly premiums of a term insurance plan.

Of course, you definitely don’t need to give up on coffee altogether but consider substituting one cup of barista-made coffee per week with one purchased at local coffee shops for an average price of S$2, and the money saved can be used for monthly premiums of a term insurance plan!

5 everyday items that cost more than term life insurance

Take public transport

At an average cost of S$0.703 per kilometre, taxi rides in Singapore are the 13th cheapest in the world4.

Despite the occasional discount or promotion codes, no amount of savings or offers on taxis can help keep costs down in the long run. By taking taxis daily, you may end up spending far more than a term life insurance plan.

Taking the MRT or bus will not only save you huge sums of money, but it also goes a long way toward helping our environment by reducing air pollution and conserving natural resources. Plus, that’s money you can put towards the cost of your term life insurance premium.

Homemade lunch for full time workers

A plate of Nasi Padang or Hokkien Mee for lunch at the local food centre won’t cost you a fortune – but eating out every day is going to prove expensive. Assuming every meal cost an average of S$4, having meals at hawker centres every weekday would cost you nearly 6 to 10 times more than the monthly premium of a term insurance plan!

Opting for homemade lunch once a week will not only help save extra dollars, but it’s also the healthier alternative.

Save electricity, save the world

In Singapore, the average utility bill for a 4 room HDB flat is S$134 per month5 - that’s not a whole lot, but it still cost 2 to 4 times more than a basic term insurance plan.

There are easy and practical ways to bring this cost down. Start by doing an energy audit in your house. Are you leaving unused electronics plugged in and turned on? Do you use energy efficient LED bulbs? Can you swap out the air-con for a fan? What kind of electricity meter do you have installed – a cumulative meter (most common) or an advanced meter (allows for better efficiency in energy use)?

By doing all of this, you’re going to enjoy more savings, while also contributing to a greener and cleaner planet.

5 everyday items that cost more than term life insurance

Go on-demand

Cable connections were once considered an indispensable part of consumers’ life. However, with the penetration of the internet and social media, TV’s appeal and influence on our lives is waning. Still, the costs keep going up, with basic cable subscription plan setting you back at least S$28.80 to S$33.17 and more6.

If you’re not using your television screen to consume content – then opt to cut your cable cord or go in for a more affordable on-demand subscription package instead. With the money saved, you can portion some of these to a suitable term life insurance policy!

Most of the people can purchase a term life insurance by making small changes that don’t hurt too much. Each of these moves will help save a little money, and when combined, can contribute a significant part to your insurance premiums.

Interested to find out more?

Speak to a financial consultant today!

Interested to find out more?

Disclaimer:

ManuProtect Term (II) is underwritten by Manulife (Singapore) Pte. Ltd. (Reg. No. 198002116D). This advertisement has not been reviewed by the Monetary Authority of Singapore. Buying a life insurance policy is a long-term commitment. This policy has no cash value. Buying health insurance products that are unsuitable for you may affect your ability to finance your future healthcare needs. This article is for your information only and does not consider your specific investment objectives, financial situation or needs. It is not a contract of insurance and is not intended as an offer or recommendation to purchase the plan. You can find the full terms and conditions, details, and exclusions for the mentioned insurance product(s) in the policy contract.

This policy is protected under the Policy Owners’ Protection Scheme which is administered by the Singapore Deposit Insurance Corporation (SDIC). Coverage for your policy is automatic and no further action is required from you. For more information on the types of benefits that are covered under the scheme as well as the limits of coverage, where applicable, please contact us or visit the LIA or SDIC web-sites (www.lia.org.sg or www.sdic.org.sg).

We recommend that you seek advice from a Manulife Financial Consultant or its Appointed Distributors before making a commitment to purchase a policy.

Information is correct as of 29 October 2020.

 


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