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Nitesh Patel
Finance | Financial advice

By Nitesh Patel

Single people have different financial responsibilities and planning needs than married couples. Nonetheless, they need to plan their financial futures just the same. Everyone, whether male or female, single or married, needs to think through their financial goals based on financial position now and what they would like it to be in the future.

When it comes to planning for financial futures, single people often sell themselves short by overlooking an important part the equation: insurance. In particular, health, disability and life insurance can help protect against a substantial risk of financial loss, married or not. In fact, nearly half of all Americans filing for bankruptcy do so because of medical expenses.1

What many don’t realize is that a long-term injury or illness can occur at any time, preventing a person from working for months or years. It also could preclude one from being able to purchase life insurance.

It’s obvious that the younger you are, the lower your chances are of dying. However, the chances of suffering a disability are significantly higher. For example, nearly one out of three 25-year-old females will become disabled for 90 days or more before reaching age 65. For males, the chances are one out of five.2 Ironically, people will insure their car, home and even jewelry without hesitation but don’t think about protecting one of their most valuable assets: their ability to generate income.

If you have not already done so, you should consider the importance of having health, disability income and life insurance protection.

Health insurance

You probably have some type of coverage through your employer -- most people do. If you do not have health insurance, you are putting yourself at risk of incurring financially overwhelming medical or hospital expenses if you were to suffer an injury or illness. With an individual policy, you can keep premium costs down by electing higher co-insurance limits or a larger deductible. The premium cost to have full coverage for ordinary doctor visits and run-of-the-mill illnesses may be more than if you were to pay for them out of pocket. Instead, you may be better off choosing a policy with a “stop-loss” provision to limit your share of overall health care costs to a manageable sum.

Disability income insurance

Another important way to protect yourself financially is to insure your ability to generate income. This is especially true for self-supporting singles without other people or sizable assets to rely upon. A disability can have a devastating impact on one’s finances: expenses for a mortgage/rent, groceries and other basic necessities continue and may even rise if you cannot work.

Disability income insurance can replace a good part of your paycheck if you are unable to work because of an accident or illness. Some employers offer short-term and possibly long-term group disability coverage. However, if your employer does not provide this type of coverage, the amount your employer provides is not sufficient or you are self-employed, you should consider purchasing an individual policy. You can customize a policy to accommodate a wide range of financial (and budget) needs.

Life insurance

Many people think you have to be married with children to need life insurance. But, as a single person, you should think twice before you dismiss life insurance altogether. You may not have an immediate need for it, but think about your future. Do you plan to get married and start a family some day? Will there be a time when others will rely on you financially? If you buy now when you are young and in good health, you can “lock in” coverage at a lower premium and guarantee you will have insurance to help protect your (family’s) financial future.

To keep costs down, you can purchase a term policy with the option to upgrade to a whole life policy. If and when you choose to upgrade at a later time, the new whole life premiums will be based on your health at the time you purchased the term policy, regardless of your health at the time you upgrade.

While there are many factors to think through with regard to your short- and long-term financial needs and goals, talking with an insurance representative can help. A trusted representative can help you decide what kind of insurance is best for you and how much you may need to achieve financial security in the long run.

Single or married, insurance is one way to help you manage some of life’s risks and an important part of a sound financial and personal plan. The financial goals you have for today may be simple and few, but planning with the future in mind can help you reach the financial goals of a lifetime.

* “MarketWatch: Illness And Injury As Contributors To Bankruptcy”, Harvard Law School and Harvard Medical School, February 2, 2005

* “What Are The Odds” calculator, |Learning Center| Calculators

Nitesh Patel is a financial representative with the Northwestern Mutual Financial Network based in Clearwater for The Northwestern Mutual Life Insurance Company, Milwaukee, Wisconsin). To reach Patel, call (727) 799-3007 or e-mail

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