Should You Buy Life Insurance in Your 20s?

Should You Buy Life Insurance in Your 20s


Most of us have to deal with two things at once – long-term chronic illnesses that require expensive treatments and the lack of enough money to pay for them. In such circumstances buying an insurance policy can prove an excellent investment. A critical illness plan will provide you with monthly income after diagnosis, no matter how old you are when it happens. With this type of coverage, family members get additional support during their recovery, which might be one of the most challenging moments they would experience in their lives.

So, when is the right time to purchase a life insurance policy? 

In your 20’s, 30’s, after marriage, once you have had kids, or when you are finally in your 50’s. The truth is, no one knows. Answering that question is much similar to asking, when do you get a house? Some say as soon as possible, some say never. And while many people go throughout their life without ever getting a life insurance policy, we strongly advise against it.

Life insurance might feel like an unwanted purchase, especially in your 20’s. And in most cases, you are not wrong. Insurance is an unsought product that people don’t care about until they face unexpected accidents at least once or twice. The right time to purchase a life insurance policy is right before you develop a chronic disease or are about to get into an accident. But since no one can predict when you will run into one of those, the sooner you do it, the better.

You will find the cheapest rates

Purchasing life insurance in your 20’s has some benefits. Research shows that people who buy life insurance at a young age end up paying significantly less premium in the long run than people who get a policy in their 30s or 40s. For example, A 27-year-old female who buys an insurance policy of $500,000 has to pay an annual premium of $225, whereas a healthy male at the same age has to pay $286. The amount increases substantially with age. The same policy ten years later will cost $238 for a woman and $300 for a man. And this number is not coming down. With massive environmental degradation, pandemics, and unhealthy eating patterns, no one can guarantee what’s in store for us. This increases insurance risks, which causes a significant increase in premiums.

There is no reason to reject your insurance application in your 20s

Insurance companies like nothing more than healthy young people who don’t have a family history of chronic diseases and are doing exceptionally well in their lives. This means their investment is secured. When applying for insurance applications, the younger you are, the better. Getting an insurance policy before you develop diabetes, heart problems, or other long-term diseases, will ensure coverage when disaster hits. Some insurance companies refuse to grant insurance policies to sick people who have a long history of medication and hospital visits or do so only at high premium rates. Securing a policy when young can help you lock in the cheapest rates and ensure that you don’t get cheated on your insurance application.

Protect yourself from debt

With student loans right around the corner or already hanging on your head, how confident are you that you can take out another loan if everything goes south? Health coverage in the United States is not exactly cheap, and in the case of chronic diseases, there is no upper spending limit. A life insurance policy is the only way to protect yourself from such financial disasters. And with America’s increasing medical expenses, it might be a good idea to get your insurance policy before developing chronic diseases that require expensive treatments and medication.

It's not only for you

Let’s say you are the primary earner in your family. You look after your kids, parents, the household expenses, and your significant other. What would happen to the rest of your family if something were to happen to you. Survey tells us that 44% of families agree that their family would be significantly affected if something happened to the primary earner. Life insurance goes a long way in ensuring that your family doesn’t suffer even if you meet an unfortunate ending.

So, do you need life insurance in your 20s?

While evidence suggests that buying life insurance in your 20s is a great idea, some experts believe otherwise. Some believe that purchasing an insurance policy should be put off until you need the coverage or enter old age. While others argue that, by that point, it will all be too late. So, it all comes down to what you want and how your finances are shaping up early on. But if you ask us, the sooner, the better.

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