12 Jun Do millennial parents really need life insurance?
A study of millennial parents has revealed some startling statistics and attitudes towards life cover. Three quarters of young parents said they have no life insurance in place to cover them should the worst happen. Despite how much of an impact this can have on those left behind, 67% also said that they simply did not have time to go through their options.
What is life insurance?
Life insurance delivers the peace of mind of knowing your loved ones are financially protected should the worst happen. Life cover normally comes in the form of “term insurance”, which covers the policy holder for a set period of time, normally around 30-35 years.
If you were to die during the policy’s term, your family will receive a pay out of a lump cash sum, or alternatively a regular income that can be used to pay off an existing mortgage or other bills.
Why don’t more millennial parents have it?
Generally, younger parents will always feel that life insurance is less of a priority than older generations, simply because they are less likely to die anytime soon. Currently, millennials would rather spend their funds on new technology and experiences, than on insurance against future events.
When asked, many millennials also assumed that life insurance was simply too expensive to consider, with 80% prioritising other financial needs, such as living expenses, recreational expenses, and saving money for the future.
Life stages, such as buying a house, are being reached much later by millennials. This means that many young parents are left vulnerable while renting, without having had the life insurance conversation with their mortgage adviser.
Why is it such a good idea for millennials?
One of the reasons millennials should be considering life insurance is their age. Life insurance is often cheaper when you are younger, which means putting it off only increases the cost of the monthly premiums.
If you have dependents and people that rely on you, then you need to consider what would happen if your income was suddenly taken out of the picture. Would they be able to live comfortably? Would they have the same lifestyle? Moreover, would they have the stress of financial worries piled onto the difficulty of dealing with your death?