For many Colorado families, buying life insurance is one of the most important financial decisions they’ll ever make—yet it’s often the most delayed. Between juggling careers, raising children, and managing the rising cost of living, it’s easy to put life insurance on the back burner. But waiting too long can cost more than just higher premiums; it can mean leaving your loved ones financially vulnerable.
At Rocky Mountain Insurance Advisors (RMIA), we specialize in helping families across Castle Rock and the Front Range make confident, informed decisions about their life insurance coverage. This guide breaks down the essentials of term life insurance—how much you need, how long your policy should last, and why now is the right time to secure protection for your family’s future.
Understanding Term Life Insurance
Term life insurance is one of the simplest and most affordable ways to protect your family financially. It provides coverage for a fixed period—typically 10, 20, or 30 years—and pays a tax-free death benefit to your beneficiaries if you pass away during that term.
Unlike whole life or universal life insurance, which include cash value components and lifelong coverage, term life is purely protection-focused. This makes it ideal for individuals who want substantial coverage at a lower cost, especially during the years when financial responsibilities are highest.
Why Term Life Is Popular Among Colorado Families
- Affordability: Term life policies cost significantly less than permanent life insurance.
- Flexibility: You can choose a term that matches your financial milestones—such as paying off a mortgage or raising children.
- Simplicity: No complex investment or savings elements; it’s straightforward coverage.
- Peace of Mind: Provides your family with the resources to maintain their lifestyle and goals even in your absence.
According to the Life Insurance Marketing and Research Association (LIMRA), more than 45% of U.S. households would face financial hardship within six months of losing their primary earner. Term life insurance bridges that gap, ensuring your family’s financial security continues even when you can’t be there.
How Much Term Life Insurance Do You Need?
Determining the right coverage amount can feel overwhelming, but it doesn’t have to be. The goal is to choose a death benefit large enough to replace your income, pay off debts, and fund future expenses.
The 10x Income Rule (and Beyond)
A common starting point is to purchase coverage worth 10–12 times your annual income. For example, if you earn $75,000 per year, you might consider a $750,000–$900,000 policy. However, this rule should be adjusted for personal circumstances.
Key Factors to Consider:
- Outstanding Debts – Include your mortgage, auto loans, credit cards, and personal loans.
- Dependents – Consider the financial needs of your spouse, children, or aging parents.
- Future Expenses – Factor in college tuition, weddings, or childcare costs.
- Savings and Investments – Subtract your existing savings or assets that could offset expenses.
- Final Expenses – Include funeral costs and medical bills, which average around $10,000–$15,000 in Colorado.
For a more precise calculation, RMIA offers complimentary coverage assessments tailored to your family’s income, debt, and future goals.
Choosing the Right Policy Length
Selecting the right term length is just as important as determining the amount. Your goal is to ensure coverage lasts through your key financial obligations.
10-Year Term:
Ideal for individuals nearing retirement or paying off short-term debts.
20-Year Term:
A common choice for parents of young children, offering protection until they become financially independent.
30-Year Term:
Best for young families, homeowners with long mortgages, or those seeking extended peace of mind.
The average age of first-time homebuyers in Colorado is now around 36 years, and most take out 30-year mortgages. A 30-year term policy aligns perfectly with these long-term financial commitments, ensuring your family can remain in their home even if the unexpected happens.
If you purchase term life insurance in your 30s or early 40s, you’ll lock in lower premiums for decades. The earlier you start, the more affordable your rates will be—healthy applicants under 40 often qualify for coverage under $30 per month for $500,000 in protection.
Term vs. Whole Life Insurance: Which Is Right for You?
While term life offers simplicity and affordability, it’s worth understanding how it differs from whole life insurance to make the best choice for your needs.
Term Life Insurance provides coverage for a set period—usually between 10 and 30 years—and is designed to protect your family during key financial stages, like raising children or paying a mortgage. Once the term expires, coverage ends unless renewed or converted.
Whole Life Insurance, on the other hand, lasts your entire lifetime and includes a cash value component that grows over time. While it provides lifelong protection, it comes at a much higher cost and is often best suited for estate planning or long-term wealth transfer.
Many families start with term life insurance when budgets are tight, then later convert part of the policy to permanent coverage as their financial situation improves. RMIA helps clients compare these options and plan for transitions if their needs evolve.
Why Now Is the Right Time to Buy Life Insurance
One of the biggest mistakes people make is waiting until “later” to buy life insurance. The reality is that “later” often becomes too late—or at least more expensive.
Rates Increase with Age
Each year you delay, your premiums rise. A healthy 35-year-old might pay $25 per month for a $500,000 policy, but at age 45, the same coverage could cost $45–$60 per month.
Health Can Change Unexpectedly
Life insurance premiums are largely based on your health at the time of application. Even minor changes—like high blood pressure or weight gain—can raise rates significantly.
Financial Obligations Are Growing
As Colorado’s housing market and living costs continue to rise, families are taking on more debt than ever. Securing coverage now ensures those obligations don’t burden loved ones later.
Peace of Mind Is Priceless
Knowing your family will be financially secure allows you to focus on living your life fully today. Whether it’s planning for college, a new home, or retirement, life insurance brings clarity and confidence.
According to a 2024 LIMRA study, 39% of Americans say they “intend to buy life insurance within a year,” yet less than half follow through. Those who act early benefit from the security and affordability that hesitation erodes.
How Rocky Mountain Insurance Advisors Can Help
At Rocky Mountain Insurance Advisors, we know life insurance isn’t just about numbers—it’s about people, families, and long-term dreams. Our mission is to simplify the process and help you make choices that align with your goals, lifestyle, and budget.
Here’s how we help our Colorado clients:
- Personalized Coverage Analysis: We assess your current financial picture and recommend the right amount and term length.
- Carrier Comparisons: As an independent agency, RMIA partners with top-rated insurers to find the best rates and benefits for your situation.
- Conversion & Renewal Options: We explain flexible paths if you want to convert to whole life later.
- Ongoing Reviews: We revisit your policy as your life evolves—whether you get married, have children, or buy a home.
From young professionals just starting out to parents planning for college savings, our team ensures your life insurance fits your changing priorities.
Life moves fast—and protecting your loved ones shouldn’t be something you postpone. Term life insurance gives Colorado families the financial security and peace of mind they deserve at an affordable cost. At Rocky Mountain Insurance Advisors, we help you determine how much coverage you need, how long it should last, and which policy best fits your stage of life. Whether you’re starting a family, buying a home, or planning for the future, now is the perfect time to secure protection that lasts. Call 303-663-9457 today for a personalized term life insurance quote and start building your family’s financial safety net today.
Protect your family’s future with affordable term life insurance from Rocky Mountain Insurance Advisors. Call 303-663-9457 for your free quote and expert guidance today.