Can young adults afford life insurance?

Life insurance tends to be much less expensive than people think - especially millennials. A study found that almost half of millennials overestimate the cost of life insurance by up to 500%. In reality, the average monthly policy payment for a term life insurance plan costs less than a night at the movies for a healthy 30-year-old. Costs do increase over time, however, so your policy will always be cheaper when you're younger. A life insurance agent can help you find a life insurance company and policy that meets your budget and needs.

How much life insurance should a young adult buy?

To answer that question, look at all your financial obligations and how much it will cost to replace your income, cover day-to-day expenses, and pay any debts. Since those obligations are likely to grow, consider how they may change over time. Our life insurance calculator can help you crunch the numbers.

What coverage length should you get?

It's hard to know what the future will hold when you're starting out, but life insurance is one area where you'll want to think long-term. Consider how life changes, like having kids or buying a house, will affect your financial obligations. Planning ahead can save you money as well. For example, if you buy a 10-year policy and have to renew it later, you'll end up paying higher rates on the new policy than if you buy a single 30-year term policy now.

What's the best age to buy life insurance?

The younger you are, the less expensive life insurance premiums will be. So, buying life insurance in your 20s or 30s could end up saving you money over time, especially if you lock in an affordable rate for a longer term.

Life insurance for young adults

Think you’re too young for life insurance? Getting covered now can help you save money and plan for what’s ahead.

Why do young adults need life insurance?

First job. First apartment. First life insurance policy? Your 20s and 30s come with lots of milestones, which might mean it’s time to consider life insurance.

Life insurance is designed to provide a cash payout to help your loved ones cover expenses after you’re gone. A life insurance policy may not seem like something you’ll need yet, but getting insured early can be a smart move. Here are a few reasons to consider life insurance as you’re just starting out.

To protect your loved ones: Life insurance isn’t for you, it’s for the ones you leave behind. If you have a partner, kids, or anyone else depending on you financially, coverage is a must. Your policy is there to help replace your income, pay for day-to-day expenses, and cover funeral costs if you die unexpectedly.

Because it will never be more affordable: As you get older, your life insurance rates typically increase with each passing year. So, if you’re planning to get married, have kids, or buy a home, it may make sense to lock in those low rates now. Applying for a policy early can also protect you if you develop a medical condition. Once you buy a life insurance plan, you have guaranteed coverage for the entire life of the policy, no matter what happens to your health. If you wait and develop a health issue, though, you may not be able to qualify for life insurance.

To pay off debt: If you have student loans, a mortgage, credit cards, or any other co-signed debt, those expenses can become someone else’s issue after you die. Life insurance can provide funds for your spouse, parents, or other co-signers to cover any student loans or other debts left behind.

To supplement group life coverage: Your job may offer a group life policy as part of your benefits package. But while these policies can provide affordable protection, they’re usually not enough to meet all your needs. You typically can’t take group life policies with you when you switch jobs, something millennials do four times on average within 10 years of graduating college. Plus, the average amount of a group policy is often way below the amount needed for your family to replace your income. Your own life insurance policy is something you can always carry with you to keep your family’s future secure.

Who doesn’t need life insurance?

While there are plenty of good reasons to buy life insurance when you’re young, coverage may not make sense for everyone. If no one depends on you financially and you’re debt-free with savings in case of an emergency, you may not need it – at least, not yet.

To help you decide, ask yourself, “Would someone be worse off financially if I died?” Make sure to consider all current and future financial needs to keep your family covered.

The best life insurance for young adults

Term life: Term life insurance keeps you covered for a set period of time, usually 10 to 30 years, and is the best bet for most young adults. The most affordable type of life insurance around, term life can insure you right when you need it, like when you’re paying a mortgage or raising kids.

Permanent life: Permanent insurance covers you for your entire life and includes a cash value component that grows over time. You can borrow from the cash value in your policy or use it as collateral for a loan. It’s much more expensive than term insurance, but if you know you’ll have dependents for your entire life, like a special-needs child, it may be the best fit.

You’ve got questions. We’ve gotanswers.

Life insurance tends to be much less expensive than people think – especially millennials. A study found that almost half of millennials overestimate the cost of life insurance by up to 500%. In reality, the average monthly policy payment for a term life insurance plan costs less than a night at the movies for a healthy 30-year-old. Costs do increase over time, however, so your policy will always be cheaper when you’re younger. A life insurance agent can help you find a life insurance company and policy that meets your budget and needs.
It’s hard to know what the future will hold when you’re starting out, but life insurance is one area where you’ll want to think long-term. Consider how life changes, like having kids or buying a house, will affect your financial obligations. Planning ahead can save you money as well. For example, if you buy a 10-year policy and have to renew it later, you’ll end up paying higher rates on the new policy than if you buy a single 30-year term policy now.

Life insurance quotes through eFinancial

At eFinancial, our goal is to make buying life insurance easy, affordable, and convenient. We offer a variety of life insurance policies and products from more than 20 top providers. Our team of agents is committed to supporting you through every step of the process, so you can get covered as quickly as possible.

Want to learn more? Request your free, no-obligation online quote today, or call 866-388-3996800-957-9525 to talk with one of our agents. to talk with one of our agents.