For most young people, life insurance only comes as an afterthought even though it ought to be a priority. Your 20’s mark the beginning of one of your productive phases in your life. Best utilise it by setting up an emergency fund, saving up for a mortgage, paying off debts, or saving for retirement.
The fact that you’re young and healthy can deceive you to care less about the future. However, life risk factors such as illnesses or injuries have no preferred candidate or age. Misfortunes can strike anyone including the most youthful.
So, how do you counter the unpredictable tomorrow? Getting life insurance is a great starting point. Below are a few reasons it’s advisable to get life insurance in your 20’s:
In your 20’s, it’s likely you are living in a rented apartment or still under your parents’ roof. However, all those are temporary housing solutions which you are bound to outgrow at some point soon. Particularly, if you get married and have a family of your own, the urge to buy a home becomes even stronger.
For many, acquiring a home via mortgage becomes the immediate and often preferred solution. While this is a great step, it doesn’t guarantee your beloveds will still have a home in the event you pass away suddenly without having finished making payment. Luckily, you can protect your home with a policy like a mortgage life insurance.
Acquiring mortgage protection early guarantees your family a roof over their head whether you pass away prematurely or not. The sum assured decreases over time as you get closer to clearing your mortgage balance.
Your insurer relieves your family the financial distress and fear of eviction that comes with unpaid home loans.
Life insurance is generally cheaper when you get it at a younger age. Insurers consider older people to be at a higher risk of passing away because of their vulnerability to risk factors such as lifestyle illnesses. On the other hand, people in their 20’s are deemed to be potentially healthier and safer from predictable death causes.
The state of your health is a key factor that insurance firms use to determine the premiums to pay. As such, getting life insurance while young allows you to take advantage of the more affordable rates.
Student loans repayment
A common financial burden that people in their 20’s grapple with is the repayment of student loans. For government-sponsored loans, passing away with an outstanding balance is often a non-issue as it will be written off. However, the problem comes with private loans which mostly require close family members to be the guarantors.
When you pass away the loan repayment obligation transfers to your guarantors, a big burden you don’t want to leave them. An effective way to spare your beloveds from such financial hardships is getting a life insurance cover. This policy takes care of your debt in case you pass away having not cleared the loans.
What’s more, your cover can also help to meet death-related costs such as funeral expenses. With that, you get a decent send-off thereby relieving your loved ones any financial distress.
How to purchase life insurance in your 20’s?
Life insurance requires prior planning if you’re to get everything right including the provider and the cover itself. Below are a few useful tips that can help:
First, decide the amount of money you can afford to pay without fail every month to acquire a cover that aligns perfectly with your budget. You don’t want to miss payments and end up getting denied cover when a risk occurs.
After picking your preferred package, it’s time to consider your buying options. For example, if your employer offers insurance coverage as part of their employment benefits, you may consider joining the scheme. Alternatively, you may find a trustworthy life insurance provider to buy a personal policy for your situation. A few options to consider here are term life, whole of life or family income protection cover.
To this end, we hope our post today clarifies the concept of getting life insurance in your 20’s. In a nutshell, be sure to get a policy that you can afford whether permanent or not. You could also choose to purchase multiple policies to protect various aspects of your life.
What is stopping you from taking life insurance in your 20’s? Talk to us today and we will be happy to help.