When you hear the term “life insurance,” do you think of older people, or those with health conditions? While it’s true that these segments of the population may benefit most from having life insurance, it acts as an important financial safeguard for everyone, especially because it allows you to protect your family. Industry data shows that only about 10 percent of young people have enough savings to cover their debts if they should die unexpectedly. This gap in coverage leaves their families at risk of having to pay off unexpected debts, like student loans or even credit cards.
Financial planners often encourage younger adults to prioritize getting life insurance, even if it’s just enough to cover one year of their salary or expenses. Sometimes, life insurance is available through work, though these policies won’t follow you if you change employment, which many young people do every few years. For this reason, it is more advantageous to look into term life insurance, which is a policy that covers you for a certain amount of time and can follow you from job to job.
Here are two more reasons younger people should consider life insurance:
You Can Lock in Decades of Security Right Now
There’s no doubt about it – life insurance is incredibly cost-effective for young people. A moderately healthy person in his twenties can usually get a $100,000 term policy for the monthly price of less than twenty bucks. Think about it: you can lock in a 30-year policy when you’re young and healthy and give yourself a safety net for decades to come, for the cost of a few fancy coffees per month.
You Can Get More Bang for Your Buck
If you think about it, young people have the most to gain from life insurance. Term policies usually require a physical in order to set your rate, so young and relatively healthy people can actually get much more bang for their buck than Baby Boomers or Gen Xers. Getting a policy now – as opposed to waiting a decade – can save you substantially over time.
If you don’t have a policy yet, it’s time to start investigating your options and safeguarding your family’s financial future today.
Image via Unsplash/Simon Maage
