If you are young, single, and ready to mingle (or not), life insurance might be the last thing on your mind. First of all, you probably have bills up the wazoo. Secondly, most young people don’t really like thinking about death so soon. Well, young people, its time we had an honest conversation about life insurance.
Usually, people buy life insurance if they have a spouse and children. They buy a policy to protect their loved ones in the unlikely event that the unthinkable happens. After all, you would want your family to be able to keep up with the mortgage payments, school bills, grocery bills, and other expenses that keep a family afloat.
If you don’t have kids or even a spouse, you might think that buying a life insurance policy is just another un-needed expense. You probably would rather use that money to party on a Friday night (am I right?). However, there are still many good reasons to buy life insurance. I’ve highlighted some of these reasons below:
Prepare For Your Eventual Retirement
Since young people tend to live in the present, they often blow off potential ways to prepare for the future. One huge event to prepare for is your retirement. Many young, single, and ready to mingle (OK, I’ll stop saying that) folks miss out on the potential retirement savings benefits that come with a life insurance policy.
Many life insurance policies have a cash value accumulation feature. These policies will build cash value over time through their underlying investment vehicles. Eventually, these investment returns will negate the need for additional premium payments. In addition, at the time of retirement, the client can withdraw cash from the policy as sort of a “tax-free loan”. These loans do not have to be repaid, instead, the amount will simply be deducted from the benefit when you die.
As we will say many times throughout the duration of this article, buying a life insurance policy now instead of later is a smart move as it allows you to take advantage of lower premium rates. Think of it as a low-cost investment for your retirement.
Protect Your Parents In The Future
As your parents age, they will need to have more money for healthcare. These healthcare costs may or may not include nursing homes, assisted living centers, nursing, and just the many other health related serviced that are required by the elderly.
If you happen to die before your time, you will not be able to care for your aging parents, so you will need to hire somebody else to do your dirty work. As you may or may not know, the cost for something like this can be outrageously expensive. Keeping a life insurance policy with enough money to pay for your parents’ healthcare (or even a long-term care insurance policy) is just the right thing to do.
Your Future Family Might Need It
You may not be married today, but nobody knows what the future holds. If you buy a life insurance policy when you are still young and healthy, you will be able to lock-in lower rates that might not be around when you become old and grey.
When you are still young, you are also a lot less likely to have any pre-existing health conditions that would show up on a life insurance policies health exam. No pre-existing medical conditions means that your life insurance health rating will be much more desirable to life insurance providers, thus providing you with much lower month-to-month premium rates. In addition, by signing up BEFORE you develop a medical condition (God forbid), you will be guaranteed renewal at the same rates even if you develop a medical condition later on in life. It’s really a win-win situation.
Your Funeral Will Be Expensive
One of the more somber things to think about is your own funeral if you happen to die. Who would pay for your funeral and burial expenses? Currently, the average funeral in the United States costs between $7,000 and $10,000. This is a large amount of money by any metric.
Would you want your parents to be burdened with this cost? How about your brother or sister? Or even your friends? Although nobody wants to think about his or her own morbidity, it would be even worse to die and leave your family/friends no way to pay for your burial. If for no other reason than to cover your own burial if you happen to pass, buying a life insurance policy makes perfect sense.