As a Millennial or Gen Zer who’s young and healthy, life insurance may be the last thing on your mind. But life is unpredictable, and having coverage in place is important in case of unforeseen circumstances. In honor of Life Insurance Awareness Month, check out these four reasons Millennials and Gen Zers should consider life insurance coverage.
1. You have people who rely on you.
Life insurance promises to pay your loved ones a sum of money in the event you pass away. If you’re in a committed relationship, engaged, married or have children, life insurance is key in protecting the people who matter most to you. Your life insurance benefit can help your loved ones replace your income and maintain their home and lifestyle if you’re gone.
And even if you’re single and don’t have children, chances are there are still people who would be financially impacted if you were to pass away. For example, life insurance can help protect your parents, siblings and loved ones from your burial expenses. And if someone has ever co-signed on a loan or credit card for you, life insurance can help protect them from your debts.
2. Life insurance tends to cost less when you’re younger.
Life insurance premiums are what you pay in exchange for coverage. Premiums are calculated based on many factors, beginning with how much coverage you’re purchasing and the type of policy. Then, your personal information and risk level are taken into consideration. Your age, health and life expectancy are all factored in when determining premium amount.
That being said, the younger and healthier you are, the less your life insurance will likely cost. When you lock in low, long-term life insurance rates in your 20s or 30s, you can enjoy them for decades to come. And if you end up developing an illness later in life, your coverage cannot be revoked, as long as you keep paying your premiums.
3. Your employer policy may not be enough.
Does your place of employment provide you with free or low-cost life insurance? Employer-sponsored life insurance is a great benefit, but it may not be enough, especially if you own a home, are married or have children. That’s because workplace polices often only provide a basic minimum amount of coverage, and you probably can’t keep the coverage if you change jobs. That’s why many people decide to purchase their own individual life insurance policies outside of work.
4. Choosing the right policy can help you meet other financial goals.
Life insurance coverage falls into two main categories: term and permanent.
Term life insurance covers you for a certain number of years before coverage ends.
Permanent life insurance covers you for your lifetime, plus also can feature a money savings component that allows you to build cash value. There are several different types of permanent policies, including whole life and universal life. Depending on the type of policy, cash value grows from your deposits; interest earned; and/or growth based on the stock market, an index or investments. Typically, you can withdraw or borrow from your policy’s cash value as needed.
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Are you a Millennial or Gen Zer? Do you have questions about securing life insurance coverage? We’re here to help! Our 30 Under 30 award winning agents are your peers who understand the unique financial challenges you face! Get in touch with one of our agents for the support you need.