3 Reasons I Pay My Life Insurance Premium Annually Rather Than Monthly

It's a system that works well for me.

We all have certain bills we pay on a regular basis. Each month, for example, I see my cable bill show up on my credit card statement, along with my cell phone bill and other recurring expenses.

But there's one bill I don't pay on a monthly basis -- my life insurance premium. That's because I pay that bill with one large check once a year.

Doing so does mean seeing a large sum of money leave my checking account at once. But it's still preferable to paying monthly. Here's why.

1. It's less expensive

Insurance companies will often let you pay your premiums on a monthly basis rather than once a year, and for some people, that helps them avoid cash flow issues. But that option also tends to cost more.

Since I've worked my life insurance premiums into my budget and set money aside for them every month, I don't feel the need to be charged more for the same service. And so what I do is move some money into my savings month after month so I'm able to cover my premium in full.

2. It's one less bill to think about each month

At this point, a number of my bills are set to auto pay each month. But some don't allow for that option, so I have to pay them manually.

The last time I checked, I couldn't set my life insurance premiums to get paid automatically (though to be fair, I've had my policy for a long time and there's a good chance things have changed). And because I find it annoying to deal with bills, I'd rather not add another to my monthly routine.

3. It's something I don't love to think about

Having life insurance gives me peace of mind. But let's be real -- it's not the most pleasant thing to think about.

It's one thing to pay your cable bill and think, "Hmm, am I really getting my money's worth out of this?" It's another thing to pay your life insurance premium and think, "Gosh, I hope I actually am throwing my money away." And so paying my premium once a year means I don't have to be reminded of the fact that I have and need life insurance every month.

What's the best payment option for you?

Whether it's life insurance or another bill, you may find that you're better off paying certain expenses on an annual basis instead of a monthly one. In some cases, doing so can save you a little money. But also, if you're a busy person, you'll want to consider the hassle factor.

There are times when I'll sit down at my desk with just 15 minutes to do some article brainstorming, only to see a bill waiting for me in my inbox. And then voila -- that 15 minutes is whittled down to 10. Paying my life insurance premium annually ensures fewer moments like that. And for this reason alone, I'm a big fan of my current setup.