Getting Life Insurance In My 20s – Complete Guide 2024
Written by Daniel Ray, Life Insurance Expert |
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Fact Checked by
Lisamarie Monaco |
Editorial Disclosure
If you are asking yourself, should I get life insurance in my 20’s, you have come to the right place! We will break it all down for you in this article.
You’ve got a lot on your plate. You’re living paycheck to paycheck, working hard, and looking for ways to make your money stretch as far as possible. It’s tough not to feel like you can’t afford anything else.
But is it worth the cost? Here’s what you need to know if you’re considering life insurance in your 20s.
This blog post will discuss whether or not life insurance is worth getting in one’s 20s, with the pros and cons of both arguments being discussed.
Article Navigation
- Life Insurance For Those In Their 20’s
- Life Insurance for Millennials: A Wise Move in Financial Planning
- How Much Life Insurance Do I Need?
- How do they determine my rates?
- Best Life Insurance For A 20 Year Old And Over
- Understanding Life Insurance Costs in Your 20s and Beyond
- Whole Life Insurance In Your 20s Vs Term Life
- FAQs
- Conclusion
Life Insurance For Those In Their 20’s
Is it normal for a 20 year old to buy life insurance?
For most people in their 20’s, life insurance is the last thing on their minds.
However, being so young, it’s a lot easier to get very affordable life insurance.
There are plenty of things to factor in when you’re thinking about buying life insurance rates by age. You are in good health right now. As you age, such as age 50 not only does your health change but your life insurance premiums increase.
When you first begin researching, you’ll find that term life insurance is the most affordable kind of life insurance available.
For people in their 20’s that may not be swimming in money yet, this is likely to be the kind of policy their most drawn to.
However, term life insurance has a few downsides. For one, as the name suggests, it will only cover you temporarily; terms are usually 5, 10, 15, 20 year term, or even 30.
Term life insurance is the most basic kind of life insurance — they only provide death benefit protection. Furthermore, there aren’t any cash value build-up opportunities like there are with permanent life policies.
Life Insurance for Millennials: A Wise Move in Financial Planning
Embarking on your journey in your 20s and 30s, you’re likely engaging with life-changing milestones. You may be diving into homeownership, grappling with student loan debts, or perhaps both.
It’s easy to overlook life insurance at this stage, with many under the impression they don’t need it.
However, embracing life insurance as a millennial could be one of the smartest financial decisions you make. In the hustle and bustle of this age bracket, long-term care or retirement savings might not be on your radar.
You’re in the throes of life, possibly celebrating a recent marriage, welcoming your first child, or managing a new mortgage.
Amidst these major life events, you shoulder a significant financial obligation towards your loved ones.
Opting for term life insurance can be a practical and cost-effective strategy to uphold that responsibility. It’s an investment in their future, a safety net offering peace of mind and financial security.
Hence, don’t delay. As a millennial, the time to secure life insurance is now!
Furthermore, rates don’t change much between your 20’s and purchasing life insurance in your 30s.
How Much Life Insurance Do I Need?
Now is the best age to get life insurance coverage! We will explain why this question takes much consideration and calculations. There are several factors that go into how much life insurance you’ll need.
Remember, you need enough life insurance to cover all of your debts, mortgages, or any other kinds of payments you owe so that your loved ones don’t inherit these bills.
Also, consider the fact that anyone that is financially dependent on you, such as your children, will no longer be benefiting from your income.
Therefore, you need to calculate how much money that anyone dependent on you will need in order to remain financially secure. For a lot, people, a $500,000 policy will suffice, while others may need more.
Final expenses are another cost that you’ll likely want to be covered. Funeral services usually cost around $10,000, which is a large amount of money to leave for your grieving loved ones.
If you have children, you may wish to have their education bills covered or to see them financially through to adulthood.
How do they determine my rates?
For most policies, you’ll need to take a medical exam.
This exam will determine how healthy you are, which has a huge impact on your life insurance rates.
You’ll want to make a good impression before your medical exam. Here are a few things that we recommend doing before you apply for life insurance:
- Quite Smoking
- Eat healthier
- Exercise frequently
- Lose weight
- Take measures to lower your blood pressure
As a person in your 20’s, you may not be dealing with a lot of the health issues that tend to plague older people. This will definitely help your rates. Furthermore, age has a lot to do with your insurance rates. Life insurance in your 20’s will be significantly cheaper than looking for life insurance in your 50’s.
A 50-year old’s health will be different than that of a 20-year-old. If you have any serious medical issues and feel that you won’t be accepted for life insurance, consider looking into no medical life insurance policies. Now is the time to think long-term.
As we have mentioned, life insurance for 50-year-olds (50 to 59), premiums are more expensive.
Best Life Insurance For A 20 Year Old And Over
What life insurance should I buy in my 20s?
The ultimate question, What is the best age to buy life insurance?
It really depends on the person. For some, especially those who have people depending on them financially, getting life insurance is the responsible choice.
This ensures that you take care of your loved ones in case the unfortunate happens.
Remember, whether it is permanent life insurance or term life insurance, PinnacleQuote is here to guide you every single step of the way!
Regardless, we have a few recommendations to offer. First, we recommend comparing several life insurance companies before making your decision. Rates and policies vary drastically between companies, so it’s always a good idea to receive several quotes before deciding.
Secondly, we recommend working with an independent insurance agent, as we offer here at PinnacleQuote. This is a great investment because working with an agent that knows the business in and out will save you a ton of money in the long run.
We have the ability to set you up with the best life insurance companies and make sure that you receive an excellent policy at the lowest price.
Why Should a College Student Purchase Life Insurance
Let’s face it, Life is unpredictable. We never know what can happen to any of us. The last thing we want to think of is death at this stage of life when we are just really beginning our journey in life when we are young and healthy. Believe me, this hits home as I have 4 children of my own. Better to be prepared for the unexpected on every level.
If God forbid we died today, who will take care of our funeral expenses, outstanding credit card debt, private student loans, bills, etc? The short answer, your family, your parents!
Most likely, they are still paying off their debts, their mortgage, etc.
Do you want to leave them not only devastated but financially crippled in addition to that? I am sure your answer is No.
Understanding Life Insurance Costs in Your 20s and Beyond
Here’s the real scoop. Life insurance for individuals in their 20s is so cost-effective that it’s almost baffling to see many not opting for it.
At this juncture in life, insurance premiums are surprisingly low.
This period marks your peak health and your lowest age. It’s the golden opportunity to secure a life insurance plan.
To get an idea of the cost of life insurance for a 20-year-old female or male, refer to the information below.
These estimates, however, represent healthy 20-year-olds and serve as a general range. Remember, life insurance isn’t a “one size fits all” solution.
Individual factors such as age, height, weight, smoking habits, and lifestyle significantly affect the premium.
Consequently, rates will vary. Yet, one fact remains constant: life insurance will never be as affordable as it is today. With each passing year, the cost rises. Keep this in mind as you consider your options.
Comparatively, the premium for a healthy 20-year-old will significantly differ from that of a healthy 40-year-old or older, even with the same height and weight.
Consult the chart below for average term life insurance rates by age.
Female Rate Comparisons on a 20 year Term
| Age / Sex | $250,000 Coverage Amount | $500,000 Coverage Amount | $1M Coverage Amount |
|---|---|---|---|
| 25-Year Old Female | $10.65 | $15.07 | $21.91 |
| 35-Year Old Female | $11.75 | $17.27 | $21.91 |
| 45-Year Old Female | $21.05 | $35.99 | $65.87 |
| 55-Year Old Female | $44.69 | $82.77 | $157.11 |
Male Rate Comparisons on a 20 year Term
| Age / Sex | $250,000 Coverage Amount | $500,000 Coverage Amount | $1M Coverage Amount |
|---|---|---|---|
| 25-Year Old Male | $12.08 | $18.42 | $29.33 |
| 35-Year Old Male | $13.28 | $20.22 | $32.91 |
| 45-Year Old Male | $25.82 | $45.46 | $84.79 |
| 55-Year Old Male | $59.80 | $112.61 | $215.85 |
Insurance is designed to protect us and our loved ones. I wish my parents taught me the art of financial planning and what insurance was designed for. Even the importance of a retirement plan.
Our personal finance and learning about life insurance in your 20s and all the products and services are a priority!
It truly would not hurt to hire a certified financial planner now to talk about retirement income, lost income, and the types of life insurance.
This will pave the way for your future.
Whole Life Insurance In Your 20s Vs Term Life
Should I Get whole life or term life insurance?
You have many choices with life insurance products. Two of the most popular are whole life and term. With the term, you have the option of a 10,15, 20-year term, or even a 30-year term.
We briefly spoke of the term at the beginning of this article. You pay the premiums every month for the life of the term and when that term is up, you may renew. Death payments are paid a lump sum.
The whole life is a bit more pricey. It offers cash value, unlike your term policy. It will remain in effect for your entire life as long as you pay your premiums.
The whole life is geared towards people in their retirement years. People looking for burial or final expense policies.
The Time Is Now…
All too often we all think we have plenty of time to do the things we want to do.
Life insurance should not be put on the back burner. What you put off today can cost you or your family tomorrow.
In more ways the one. Time is not on our side and no one is ever immune!
FAQs
Getting life insurance in your 20s is typically cheaper due to lower risk of health issues. It’s a proactive way to secure financial stability for future dependents and cover debts.
Yes, life insurance is generally more affordable for people in their 20s due to their younger age and typically better health, resulting in lower premiums.
Term life insurance is often a good choice for those in their 20s, offering sufficient coverage at lower premiums. Whole life insurance can be considered for long-term financial planning.
Coverage depends on your financial obligations, future plans (like family or homeownership), and your budget. A common recommendation is a policy worth 5-10 times your annual income.
Consider factors like coverage amount, policy length, premium cost, potential future financial needs, and any additional benefits or riders offered.
Many term life policies offer the option to convert to a whole life policy. You can also purchase additional coverage as your needs change.
Locking in low rates, providing financial security for future dependents, covering debts, and starting a financial planning journey are key benefits.
Yes, it can be beneficial for covering personal debts, funeral costs, and supporting aging parents or siblings, if necessary.
Research different insurers, compare quotes, check customer reviews, and consider financial stability ratings of the insurance companies.
Yes, even in your 20s, your health can impact life insurance rates. A medical exam may be required, and pre-existing conditions can affect premiums.
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Conclusion
The question of whether or not you should get life insurance in your 20s is a tough one. It all depends on how much money you make, what type of debt you have, and what other assets are at risk if something happens to you.
Getting quotes from multiple providers can be the best way to figure out which company offers the best coverage for your needs without breaking your budget.
So before making any final decisions about buying life insurance, do some research first!
