For people in their 20s and 30s, it can seem like the need for life insurance is still in the distant future. But as unexpected situations arise, such as the need for compensation for brain injury, a serious car accident or an unforeseen medical emergency, many of them realize how important it is to have a plan in place in case anything ever happened to them. How young is too young to buy life insurance? That depends.
If you have people who depend on you financially, life insurance is a no-brainier. But what about young people who are unmarried and don’t have kids? While life insurance is considered mostly to replace any income that a household loses when a person dies, it can be good for other pressing financial matters too. Recent graduates with student loans especially should consider getting a plan so that their educational debt doesn’t fall on family members if they pass away.
Life insurance also comes in handy to cover funeral charges, which everyone would incur in case of death, no matter what age. These expenses can be upwards of 7,000 and a tremendous financial burden in an already stressful period for surviving family and friends.
In addition to the cogency of buying life insurance at a young age for financial reasons, potential policyholders should also consider that the earlier they buy insurance, the cheaper it will be. As you start to age and incur different physical conditions, policies will become more expensive to obtain.
When considering what kind of insurance plan to buy, younger adults usually find themselves weighing the advantages of term life insurance against permanent life insurance. With term coverage, you can insure yourself for a specific time period, which will usually be for 10 to 30 years. This kind of plan has the advantage of lower premium payments than a permanent coverage, which lasts for life. For most young people, it makes more financial sense to take advantage of these cheaper premiums for now because they can then switch to a permanent coverage plan later without having to have any examinations to prove that they are insurable.
When it’s time to purchase an insurance plan, make sure you consider several key points. Firstly, an estimate can be hit or miss; you’ll never know what your premium and benefit are until you actually purchase a plan. And it’s always a good idea to ask questions upfront, especially when it comes to how your designated beneficiaries will be affected by the plan and whether it is convertible to a permanent plan after the term is up.
If you approach your search for life insurance with a pragmatic mindset, you’ll have more success in finding the plan that you can afford, no matter what stage of life you are in, that is also comprehensive enough to take care of any financial obligations you have and any financial dependents you have. And as long as you have loved ones, you’re never too young for life insurance.