10 Reasons to Buy Life Insurance when you’re Young
It is a highly endorsed ideology that the sooner you get a life insurance policy, the better it is for you.
- Lowest possible premiums
- Future planning
- Choice of insurers
- Emergency expenses
- Family protection
- Proper non-employer coverage
- Better safe than sorry
- Paying off debts
- Peace of mind
As humans, it is in our nature to take every possible step towards the preservation of ourselves. Our lives are the most important asset and doing everything to protect it from the harm of every kind is a very logical thing. Everyone has their way of taking care of things, but there is one aspect that is universally accepted as a definite need for us in today's world financial stability. Having enough money to ensure that we can continue to live a comfortable life is a very basic part of our lives, and taking care of those dependent on us is what makes us human. While there are a lot of different tools to provide that benefit, the biggest of all is life insurance.
It is a highly endorsed ideology that the sooner you get a life insurance policy, the better it is for you. With the need for having life insurance accepted by 84% of Americans (2018 Insurance Barometer Study, conducted by LIMRA and Life Happens), it is quite surprising to see young people questioning the need for life insurance the most. To clear the air on the subject and let you know the facts, we are providing a list of 10 reasons why young people should buy life insurance!
1. Lowest possible premiums
The only main thing you have to worry about when buying a life insurance policy is the amount of premium you are going to pay for it. The fact of the matter is, the smaller the amount of premium, the more beneficial the policy will feel. This simple fact is directly related to the mortality statistics calculated by the insurance company. While the actual time of death can never be determined, it is quite clear that most people die after growing old, and that means there is a higher chance of survival for young people during their policy term. This is of a lot of importance to insurance companies as they rely on getting full payment from policyholders for maximum return against the benefit they commit to paying. This simple factor can lead to young people not only getting lower rates but also get a much larger policy.
One of the ways that people sometimes buy life insurance is to create it as an additional source of creating savings. While it is not the most efficient way of achieving this purpose, it can be considered as an added source. If you have other sources for savings that you are already employing and want to diversify your portfolio further, getting a life insurance policy can be a way to go about it. It is, of course, advisable to look into a product that specializes in creating savings life bank deposits or other investment schemes.
3. Future planning
We already talked about how it is in our nature to take every step for self-preservation and insurance is the biggest tool for securing our future. The whole point of going to buy life insurance is to make sure that you make all the necessary arrangements at a time when you are in good shape in order to provide for difficult times ahead. While life insurance may be thought of as an alternative source of income for your dependents, it is also a great way to have a large sum of money saved for yourself when your insurance policy matures and leads to a big payout. In addition to these obvious scenarios, you can then also cash out your policy at an early stage in case you end up facing a major financial emergency.
4. Choice of insurers
As a person grows old, their insurability automatically declines in the eyes of the insurance company. With every age group that they pass, the insurance companies feel less and less inclined to provide insurance, especially at low rates. However, when you are young, the level of confidence in your life is much high, and therefore every company would want to try and make you their customer. This can literally go to the point where salespeople track you down to your house and bang on the door one after another. This much choice means you are somewhat in a position to negotiate for the lowest possible premium with the maximum possible benefit.
5. Emergency expenses
If you are still asking why to buy life insurance when you're young, then here is another small but useful reason to do so. One of the benefits that some policies have is that they come with savings plans incorporated into them. What this means is that if needed, you can easily take money out of your policy against its cash value. If you already have a savings account, but you want to keep it safe for some specific purpose, then your insurance policy can provide a route to create an alternative way for you. This should allow you to meet small expenses that you may require in case of an emergency. It is, however, necessary that you do not use your insurance policy as the main source of savings as it would not be cost-effective, and there are better options to do that directly.
6. Family protection
After yourself, the most critical people in any person's life are their family members. Your spouse and your kids are the most logical beneficiaries to have for your life insurance, and your lack of presence in the future could mean financial burdens. Having life insurance at a young age can help you take out the best possible policy without having to spend too much money! It is good to be rid of that burden at an early stage of life when you have more financial flexibility than later on when your bills start to pile up quickly. The high cost of insurance is also a big factor telling why you should buy life insurance at a young age, i.e. for the sake of your family!
7. Proper non-employer coverage
One of the biggest points stopping young people from buying insurance is the fact that their employer is offering them life insurance. You must keep your mind focused on the bigger picture and think long term here. A lot of people tend to think of that coverage as both enough and lifelong. Not only will you lose your coverage, but you will also not get any real benefit from it even if you stick around. These packages are designed to provide you with the smallest possible level of coverage to ensure the minimum cost to the employer. So if you are a young employee with company job insurance wondering why to buy life insurance when you're young, the answer is quite clear; “self-preservation”.
8. Better safe than sorry
One thing that basically plays the role of a ticking time bomb when it comes to buying life insurance is your health. You may be thinking you are young and full of energy, and you do not need any life insurance. However, the situation can turn in the blink of an eye, and you could end up contracting a disease or other health-related issue where you may need coverage. Falling into such a situation will not only make your premium price go sky-high, but there will also be a chance that insurance companies will refuse you. Having dependents who need to be taken care of in such a situation can become stressful UNLESS you have already purchased a fixed rates policy.
9. Paying off debts
Young families are often without sufficient savings present in their accounts. What that translates to is the fact that if an emergency were to occur, it would become quite difficult for dependents to pay off huge debts that most young people have. This could be college fees, mortgage for the new house or any other debts that they may have collected while trying to set themselves up. Having a life insurance policy can prove to be incredibly helpful for dependents and can help avoid unnecessary stress in an already difficult time.
10. Peace of mind
This factor is for young people just as much as it is for any other older person. Once you get a life insurance policy, you can live life with peace of mind that even if the worse were to happen, your family and your liabilities would be taken care of in a decent manner. Our lack of ability to predict the future leaves us with only options like this, and by availing these options, you can certainly ensure that you sleep with complete peace of mind at night.
It is totally natural for a young and healthy person to ask why to buy life insurance when you're young. However, we believe that these are more than enough reasons for anyone to realize why they should buy life insurance at a young age. Life is unpredictable, so it is best to take all the steps you can for a secure future!