The millennials of today have to deal with unique financial challenges these days as it involves figuring out ways to save for retirement and to think of techniques to pay off the larger than life student loan many of them are racking up.
When tending to these matters for a major part of their adult lives, most millennials often don’t pay much heed to having adequate insurance. In fact, the under 30 demographic is more likely to not have life and health insurance as compared to the older age group.
As a millennial, it’s rather easy to think that you don’t need any kind of life insurance as you’re just starting your career and are in a relatively good health. However, these top 5 reasons will make you go back and think over your decisions and they might even convince you to buy insurance sooner rather than later.
- It’s Cheap
Life insurance premiums are determined owing to the role that several factors play in our lives and this includes your age and general health. You’ll end up paying comparatively less coverage and for good reason given the fact that you’re fairly young. This becomes even more plausible if you don’t smoke or have any pre-existing health issues. As a youthful person who is in the pink of his/her health, you will portray less of a liability to the insurance company.
If you wait out until your thirties or forties to purchase life insurance, you’ll notice a significant increase in the monthly cost. Checking out rates now will help you to zero in on a good rate for the rest of the policy, which will help you save a good amount of money along the way.
- Funerals Are A Costly Affair
The average funeral costs ranges between £4000 and £10000. Someone will still have to cover the bill regardless of whether you’ve planned a traditional funeral or a non-traditional one complete with an end-of-life party. Even a moderately small life insurance policy can help cover these costs. You can give specific instructions regarding your funeral if any in your Will because it has become far easier to do so with the help of a will template.
- Some Policies Come With In-Built Savings
Though majority of the financial experts are likely to recommend a term life policy for millennials, it won’t hurt to take a look at the whole life insurance. Such form of a permanent insurance covers you until your death. Of course, its a bit more expensive as compared to a term life policy in regards of the premiums to be paid, but the policy comes tax-free and builds up good cash value over time. You can then avail a loan against the cash value down the line.
The life insurance policy can serve as a savings cushion with comparatively less risks involved. As a millennial it is safe to assume that you have many years to amass savings and this kind of cash value policy can be a nice addition to your collection.
- You Have Children To Look Out For
Most millennials wait out longer than usual to get married and hold out on having children. But if you’re amongst those who has started out early in this regard, you have to ensure that your little ones will be cared for in the most tasking situations as well. This becomes particularly important if your partner is a stay-at-home parent as they will need the money to swap your earnings at least on a temporary basis. Irrespective of whether both you and your partner are working, life insurance can still come to the rescue when the time comes to pay for higher education costs for your kids.
- Your Employer’s Insurance Might Not Be The Best Bet
In spite of having life insurance through your employer, it might be pricier to add coverage instead of buying a different policy. The rates can be rather high in the group life insurance provided by your employer. It might also lack features that you care about the most. Plus, majority of the employer-sponsored policy premiums sharply increase after you hit 35.
The Bottom Line…
As a millennial, managing your money will usually involve a lot of trial and error. But finding out as much as you can about the basics gives you the upperhand. For someone who is young, life insurance may be the last thing on your mind. However, it’s certainly something that all millennials must consider as a part of their bigger financial picture.