In your 20s, you’re probably familiar with insurance policies, having considered and bought car insurance, travel insurance, health insurance – and maybe even home insurance. But, while you’ve kick-started your career, planned your next holiday or looked to buy your first house, it’s unlikely you’ve considered buying Life Insurance.
Why would you? There might not be a lot you think you need to cover and you may have no dependants, you’re young and healthy and it is unlikely you’ll become permanently disabled or pass away any time soon.
A Life Insurance policy is integral to building a long-term wealth strategy. Buying a policy now might not seem completely necessary, but there are a number of key benefits to buying your insurance while you’re young and healthy and might not think you need it.
You can also buy your insurance policy as a couple which will offer a five to ten percent discount on your premiums, and will provide protection if one of you is no longer able to contribute to a joint income, or does not work and relies on the other’s income.
While you may not yet have a family of your own, you probably do have student debts, a loan to buy your first car, or credit card debts which have built over the years. In the event of your death or a serious injury, it’s your immediate family who will be left to pick up the pieces, all while trying to cover the cost of your health care, or worse, while grieving their loss.
A Life Insurance policy will also help cover the costs of your funeral to ensure your family isn’t left out of pocket.
To move away from thoughts of your own mortality, there are some significant and generally unknown financial benefits of buying Life Insurance young.
When you’re young and healthy your premiums will be much cheaper as you are at a low risk of death or injury. It will cost you less in the long run if you buy young. You can select a lower premium level that you’ll keep for life, bar your insurers’ price increases due to inflation. Click here for more on level vs stepped premiums.
Life Insurance will also improve your credit rating when you’re taking out a loan and can help you secure a mortgage for your first home.
If you’re kicking off your career as an entrepreneur and starting up your own business, you may also need to consider Business Expenses Insurance to protect your business in case you become ill and are unable to work. Business Expenses Insurance can cover up to 100% of your business costs to keep your business running while you’re unable to work.