Millennial life insurance misconceptions are at an all-time high. These baffling questions often leave those born between the early 1980s and late 1990s crestfallen and pessimistic, and rightfully so. Millennials are at a time in their lives when they need life insurance. Most are married, with dependent children, house payments, and over $100,000 in total household income. So, what can we say to the 55% (more than half) who have no life insurance at all?
With Arlington Greene Agency, it is easy to find the answer.
What To Consider For Your Financial Future
Before you even start to look at all the various types of insurance plans suggested for millennials, you must consider the following: tuition/school loans, credit card/outstanding debts, mortgage/household expenses, and savings/investments.
Tuition & School Loans – While the data amount of student loan debt per millennial graduate varies, Forbes reported, the consensus median is somewhere between $25,000-$30,000 per borrower. This staggering number, paired with the now questionable price tag of colleges, can eliminate our ability to save for long-term goals. To decrease the generational inability to build security and overall net worth, there are a few things to consider when it comes to tuition-dependent insurance:
- How many loans do I have left to pay?
- Do your children plan on attending college?
- Will it be private or public?
- Do I have enough to cover their future?
Credit Cards & Outstanding Debts – Millennials are the most likely generation to have more credit card debt than emergency savings, according to the 2023 annual savings report. About 45% of millennials see their credit card as a type of de-facto emergency fund. You must think about the future when considering these numbers. Try your best not to leave debt to your loved ones to stress about. This includes car loans, credit cards, medical bills, and other things left to the wind that will eventually need to be paid.
Mortgage & Household Expenses – When it comes to houses, millennials represent 43% of homebuyers, and many more are seeking to own. Now a day, inflation makes everything so expensive, also consider your family’s monthly utilities and food. With life insurance, you need to ask yourself, what do you have left on your home mortgage? In the unimaginable situation that you pass away, would your family be able to pay the monthly house payment and stay in the home financially?
Savings & Investments – It’s a growing concern that millennials are not saving enough compared to most generations. Having an accessible savings account or retirement plan is vital to a secure future, so how are you contributing? Deciding monthly amounts to place into an account is always a safe bet, but budgeting is recommended. Considering the other expense concerns covered above, subtract what you already have in savings and investments. An easy way to think about it is, “yearly income x 10 = good minimum policy amount”.
These are just a few of the big-picture items that you need to consider when looking at life insurance programs and policies. We also have more to consult here on our website.
Term Life Insurance for Millennials
A Term life insurance policy typically is used to replace lost income due to death during working years or used for business needs such a Key Man, Buy Sell, or loan collateral. In other words, it is an insurance plan that covers you for a specific period of time. It can go for 10, 20, or 30 years—and if you pass away while the policy is in place, you are covered.
Millennials specifically overestimate the cost of life insurance because they are dealing with so many firsts in their lives. Arlington Greene Agency created a sample $250,000 Term Life Insurance Plan based on a healthy 45-year-old. When you look at the term policy example, it is the most common for millennials. It also has a premium locked in for the length of the term and is usually more affordable. When you are healthy it can be very easy to qualify. Overall, it is easy to apply for, meaning you can get a policy quote within minutes. Additionally, Death Benefit generally passes to the beneficiary tax-free!
If you are thinking about term life insurance for yourself or someone else, click here for a free quote from our agency.
We also have a free Life Insurance Calculator available.
At Arlington Greene, educating millennials about how to afford accessible life insurance and how it can help young families protect their future financial security is imperative to our purpose. We have a client-first approach, unbiased advice, a company built for the busy life, and carry quality through our representation.
No matter what generation you fall under, we have a plan curated just for you. Our team wants to be a resource for all your life and home insurance needs. So, let us make it easy for you and guide you into securing your financial future!