Big Lou® here. Today I want to chat with you about why “all the single ladies” (shout-out to yonce) and single men need life insurance. Buckle your seat belt cause I’m gonna give it to ya straight.
You see, life insurance is a protection against loss of income and financial hardship that would result if you drop dead. Like, as dead as Pablo Escobar in Narcos dead…Or Stannis Baratheon of Game of Thrones dead (like everyone).
And let’s get this straight Mr. / Mrs. invincible millenial:
You will drop dead. Someday. Maybe not today, nobody knows when it will happen—just that it will happen.
[Big Lou® says: life insurance isn’t just for old people or boring people with 5 children, a mortgage and a minivan. Dying is serious stuff. Just ask your grandpa, or, well, ok don’t do that. You can ask us, we won’t get mad at you.]
I’m a Millenial, What the Hell is Life Insurance for Anyway?
Life Insurance is a protection against the loss of income that results when the policyholder passes away. The named beneficiary receives the proceeds and is safeguarded from the financial impact of the death of the insured.
For you, that probably means your parents or guardians. After all, if you drop dead on that spring break trip to Cancun how much do you think it will cost Mom and Dad to ship your limp body home, have a funeral (and afterparty to celebrate their financial independence) and put you in the ground or cremate your body? It’s not cheap, which is why most people have some sort of life insurance to protect their loved ones against the financial burden. Frankly that’s the most common reason millenials get life insurance. And, hey, we understand. Even millenials don’t want to piss off their folks—who will pay their car insurance (jokes)?
Life Insurance Isn’t Just About Dying—It’s About Living
Millenials need to know–life insurance isn’t just good for dying, it’s good for living too.
In fact, you may not know this—but there’s many different forms of life insurance. After all life insurance is a financial instrument—an investment. For example—a whole life insurance policy (a type of permanent insurance) will accrue a “cash value” over time, and that’s money you can borrow against. That differs quite a bit from a term life insurance policy that protects the beneficiary of the policy from financial burden for an explicit period of time. Another type of policy, called a variable life insurance policy (or variable universal life) is a type of permanent life insurance with an investment fund that’s tied to the performance of the stock market or bond market.
Different types of life insurance have difference uses, even for millenials. Who knew?
I’m a Single MIllenial, Do I Really Need Life Insurance?
Ask yourself the following questions to determine if you need life insurance:
Are you mortal? Is there a chance you will die?
Does dying cost money…Like, lots of cash money?
Do you have any family members that might have to pay, if you die. Will your pops be pissed he has to fork over $25k just to get rid of you?
Do you have any debt like auto loans, student loans, or credit card debt?
Do you plan on staying single forever?
Do you have an estate, any assets, or any desire to have assets in the future?
If you’ve answered yes to any of these questions, you may be a good candidate for life insurance. And, just remember, it’s not just for dying. You can use some types of life insurance as investment vehicles that are an important part of your financial portfolio.
The Number One Reason Millenials Should Get Life Insurance Now
Life insurance prices are dependent on a number of factors. One of the most important factors is your age when you purchase the policy. To put it simply–the younger you are, the cheaper your life insurance is. All other factors being equal, a 26 year old will pay less than a 35 year old when purchasing life insurance, and a 35 year old will pay significantly less than a 45 year old.
Wait but why?
It’s simple. The older you are, the more likely you are to die. So securing a life insurance policy at a younger age is a sound strategy to lock in a great price.
Millenials are Not Invincible—and Dude, You’re Aging
Go ask someone who’s 50 years old what happened to the last 25 years. Odds are they’ll answer “they flew by.”
You’re damn right they flew by. Here at Big Lou® HQ we know all too well how fast the years fly by. After all we’ve been doing this life insurance thing for 30 years. That’s before Taylor Swift was born. So you might want to shake it off and think about the big picture–you won’t be young forever and the clock is tic-toc ticking. If you’re young and healthy you’re uniquely positioned to get the best possible price on your life insurance, so don’t wait, get moving.
So next time you think “I don’t need life insurance, I’m a millenial,” here’s the 5 reasons millenials need life insurance:
- It’s an investment vehicle and part of your personal financial portfolio.
- You get the best prices when you’re young and prices generally increase as you get older.
- You’re going to die, and it costs money to die.
- You can use it to provide a legacy.
- You have outstanding debt, like student loans, auto loans, etc (and maybe a cosigner or two).