At the onset of one’s career in our early 20s, most individuals are hardly concerned about buying life insurance since they think they are young and healthy. Also, it is not seen as a very lucrative investment opportunity. However, it is recommended by financial experts that starting with life insurance at an early stage can have a lot of benefits.
The majority of the people in their early 20s are single with lesser responsibilities. However, it doesn’t mean that they will never get married and have a family. The primary advantage in buying life insurance for individuals in their early 20s is that the premium amount for young adults is lower for life insurance. For the same insurance, a person in their 30s would have to spend more on premiums. Hence, starting early means that you make more cost savings and have a higher return.
Higher education is expensive, and usually, students or their parents take huge amounts of education loans for this purpose. There is an equal burden on parents (since they are the guarantors) for repaying this debt. Since life is full of uncertainties, getting insurance at an early age would ascertain that the loan repayment does not fall upon your parents if you pass away. Your parents could use your life insurance amount in repaying the debt.
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Back-up for your loved ones
Even though there are not many responsibilities when you are young, you would nevertheless want to leave back something for your loved ones. Also, as you grow, the family members and their duties would increase. Hence, you would like to leave them with a stable paycheck if you leave the world too early. Having life insurance in the early 20s is an advantageous situation for young people. Time is on their side, and hence getting insurance with appropriate coverage can be a wise decision. Also, it would keep your loved ones protected in case any serious mishap was to happen.
Views expressed in this article are the personal opinion of Rakesh Goyal, Director, Probus Insurance, Insurtech Broking Company.