As a Young Professional, Do You Need Life Insurance?

When you’re in your 20s, you wouldn’t think that you should have life insurance. That sounds like something for older people to worry about, not when you’re this young.

The truth is though, you should be worrying about life insurance while you’re young. There are many reasons to purchase life insurance as a young adult, besides the fact that you never know what is going to happen each day.

If you’re a young professional, you should start considering life insurance. Research between term and whole insurance to see which a better fit is for you, and then speak with a trusted insurance broker.

Continue reading to see while you should consider life insurance when you are still young.

Premiums Will Never Be Lower

When you’re in your 20s, your premiums will be at some of the lowest rates you’ll ever see. That is because you are less of a risk to the insurance company of them having to pay out your death benefit (there’s a less chance you’ll suddenly pass away).

Even though it will be an added expense right now, you’ll save yourself from having higher premiums when life insurance becomes really important later in life.

Cover Any Debt

When you’re this young, there’s a good chance you’ll have some kind of debt. It could be student loans, credit cards, your first mortgage, or a car loan that you’re still paying off. If you died expectantly, someone would have to keep still paying those loans. That burden will likely fall on your family if you don’t have a spouse.

Life insurance would kick in to help cover the cost of loans you would leave behind. Your policy isn’t just about yourself. It’s actually more for protecting your loved ones upon your sudden death.

What If You Suddenly Can’t Work

Unfortunately, illness and accidents happen that are debilitating for some. The result, they can no longer work which can be detrimental to their finances without insurance. If this happened to you and you had life insurance, the policy would help cover costs you incur while you cannot work. Be aware that insurance companies can be difficult to work with, when it comes to actually filing your claim. It’s best to hire professionals if you have to deal with a denied life insurance claim.

Employer Life Insurance May Not Be Enough

Even if you have insurance through your work, it likely isn’t very much. You wouldn’t want to rely on the policy, only for your loved ones to later find out that it doesn’t provide many funds to cover expenses.

Go through your employer insurance plan and see how much more you could benefit from. That way, if the worst case scenario comes true, you can rest easy knowing the people you love will have the finances needed to continue on.

You Can Benefit Through Investments

If you consider whole insurance, there’s cash value to this type. This is money that comes from your monthly premiums and is set aside, almost like a savings account. That cash value can be used as an investment an earn you more money.

Also, you can use that money for things like going back to school or buying your first house. The money is tax-deferred, but you do have to pay it back. Otherwise, it will come out of your death benefit.

Adam Hansen

Adam is a part time journalist, entrepreneur, investor and father.