For most people between the ages of 20-30, purchasing life insurance is an afterthought. With student loans, car payments, and apartment expenses it makes sense why younger people don’t consider it a priority, however; the need for life insurance among younger generations has never been greater. Today, less than 50% of Gen Z and Millennials have any life insurance at all. So, what is the best life insurance for young adults?
Choosing to purchase life insurance is always a good idea if you have dependents who rely on your income, have quite a bit of debt, or want to lock in lower premiums while you are young and healthy. Plus, deciding to purchase life insurance when you’re young can get you a lower cost overall–making it worth the investment.
The sooner you choose a policy, the greater your sense of security will be.
Why Should Young Adults Get Life Insurance
Before we talk about the best policies to choose from, let’s go through some reasons why you may want to consider choosing life insurance as a younger adult:
- Pays For Life Expenses–if you are planning on having a family, or have one already, life insurance can cover your family’s living expenses or debts. It doesn’t matter if you have a good job with great benefits, even employer-sponsored plans offer basic group insurance, but that might not be enough for you and your family in times of need.
- Don’t Pass Debt–Having significant debt will pass on to your family if you don’t prepare. Student loans, mortgages or any other large amount is transferable after an unfortunate circumstance happens. Federal student loans are dischargeable when you pass away, but private loans are not.
- Buy Early–life insurance plans are generally less expensive when you buy as a healthy, young adult. This is because most people don’t usually buy life insurance until much later in life–or too late.
- Grow Overtime–If you are interested in a policy that grows over time, permanent life insurance builds a cash value that can be passed on or accessed later in life to make a big purchase such as a house.
- Cover Final Cost–A good policy can protect others from financial burdens that may be a side effect of an unfortunate circumstance. Life insurance prepares you for the unexpected and covers funeral costs so your family doesn’t have to.
Best Life Insurance Options for Young Adults
Choosing the right life insurance policy when you’re young will depend on your personal circumstances. Ask yourself: How much coverage do I need, and how much do I want to pay for it? These questions can help gauge which plan is best for you.
There are two main types of life insurance to choose from: term and permanent.
- Term Life Insurance is the most popular type of coverage and lasts for a specific set of years (usually 10-30). If you pass while the policy is still in effect, your beneficiaries will receive an insurance payout. If you are looking for a more affordable option, term life insurance is a simple plan that will provide your loved ones with a financially safe net income.
- Permanent Life Insurance is available your entire life. It provides a death benefit to your beneficiaries as long as your premiums are paid for. If you view life insurance as more of an investment tool, then this is a good option for you. It allows you to have guaranteed coverage while considering other options. If you have dependents who require lifelong care, or your personal profile might disqualify you from getting approved for traditional life insurance, you might want to consider this type of life insurance.
If you feel like you need more options, there are three different subsets of permanent life insurance to choose from: Indexed Universal Life, Whole Life, and Guaranteed Universal Life. Check out our other blog, “How to Choose the Best Policy for Life Insurance” to see each of these subsets explained.
We also have a free Life Insurance Calculator available if you need help visually balancing the costs.
Choose Arlington Greene for Your Life Insurance Needs
If you’ve decided to go through with a life insurance policy as a young adult, but aren’t sure where to go, Arlington Greene is here to help. The good news is that you don’t have to go through an insurance agent to actually get a policy. Most websites offer a ‘no medical exam’ quick policy, which is best for someone young and healthy, we do too! However, you may not realize that sometimes you pay more for these instant policies. Plus, if you have health issues, even minor ones, you may get denied.
At Arlington Greene, we have experts in the life insurance field who are ready to help you avoid these hurdles. We offer all the same policies that you would find going directly through a specific insurance company, but we can help you find the right coverage at the best rates by comparing them side-by-side. As a small, family-owned business, our goal is to provide the best service to all our clients. No matter which policy you decide to go with, our team can help curate a plan just for you—guiding your family into securing your financial future!