Why Millennials Need Life Insurance (2024)

FAQs

Why Millennials Need Life Insurance? ›

However, some millennials may have their parents or other loved ones co-signed on loans, credit cards and even mortgages. If you pass away, your co-signers are on the hook for any remaining debts you have. A life insurance policy can help them cover those costs.

Millennials are at a stage of life where they may be planning to or have already started a family. If you have people who financially depend on you, such as a spouse or children, leaving them without support is a serious risk. An adequate life insurance policy can cover outstanding debts and provide replacement income.

Life insurance is there to help your loved ones with financial needs if you aren't there anymore. Consider your mortgage and other debts, how much income would need to be replaced, money to cover a funeral, and college for the kids.

Buying life insurance protects your spouse and children from the potentially devastating financial losses that could result if something happened to you. It provides financial security, helps to pay off debts, helps to pay living expenses, and helps to pay any medical or final expenses.

Couples should each have life insurance in case one passes away so the other can maintain the same quality of life. People with young children are strongly recommended to have life insurance to protect their family.

According to Life Happens, 48% of millennials say they own life insurance, and nearly half say they either need to get coverage or increase their life insurance protection.

The millennials and GenZ demography are attracted by authenticity and transparency. They are likely to support the products that they assume align with their values. For insurance to become attractive to the Gen Z and Millennial Consumers, it has to tell a powerful, genuine story that connects.

Women (44%) are less likely to have or have enough life insurance compared to men (38%). People in lower-income households are less likely to have the life insurance they need. Baby boomers (27%) are more likely to have enough coverage, while Gen Z (49%) are the least likely to have enough life insurance.

Many people in their 60s and 70s may no longer need life insurance. They may have already paid off the house, stopped working, sent the kids off to care for themselves or accumulated enough assets to offset the need for life insurance. But sometimes buying or maintaining a life insurance policy over age 60 makes sense.

What is life insurance in simple words? ›

Life Insurance can be defined as a contract between an insurance policy holder and an insurance company, where the insurer promises to pay a sum of money in exchange for a premium, upon the death of an insured person or after a set period.

A common rule of thumb is at least 6% of your gross income plus 1% for each dependent. A stay-at-home parent should get enough life insurance to cover the costs incurred by the family if anything should happen to them.

Life Insurance Is Too Expensive

Many people overestimate the true cost of life insurance and believe that it is too expensive for them. It is true that the cost of life insurance can vary based on several different factors, but getting coverage can be more affordable than you think.

What is a dependent? For tax purposes, a dependent is someone “other than the taxpayer or spouse” who qualifies to be claimed by someone else on a tax return. A dependent is someone who relies on another person for financial support. Typically, this includes your children or other relatives.

Getting life insurance for retirement isn't mandatory, but it can help when you pass away in your retirement years.

If you have a child or partner who depends on your income, or if you have certain types of debt, you should seriously consider getting life insurance. While not every 30-year-old needs life insurance, some would greatly benefit from purchasing a policy.

According to that same study, about 48% of millennials and 40% of Gen Z had life insurance. However, these groups are aware that they need life insurance, with 49% of Gen Z acknowledging the need to obtain or increase existing insurance, and 47% of millennials drawing the same conclusion.

Younger often means healthier

Excellent health and youth are closely connected. Because most health issues tend to develop later in life, is yet another reason to consider life insurance when you're young and before health conditions develop.

34 percent of individuals aged 18 to 24 own life insurance, whereas 57 percent of individuals aged 65 and older own life insurance, according to LIMRA's 2022 Insurance Barometer Study.