Broker Check

Should I Have Life Insurance in my 20s?

October 26, 2022

Should I have life insurance in my 20s? Many young investors ask this very question in Naperville and Arlington Heights every day. While some feel like investing in life insurance in your 20s is not worthwhile, you might be surprised by just how affordable it can be to have greater peace of mind. Let’s go over the key points to consider when asking, “Is life insurance worth it in my 20s?”

Quick Facts about Life Insurance

  • LIMRA, an insurance industry research center, found that the number of investors under 25 with health insurance has risen from 28% in 2011 to 38% in 2020.
  • Over 50% of Investors aged 25 to 44 had life insurance in 2020.
  • There are several types of life insurance you can choose in your 20s, each with its own pros and cons.
  • Universal insurance policies become fully funded after as little as 10 years, providing coverage for your entire life and accumulating cash value that compounds.
  • Term life insurance is a shorter-term investment between 20 and 40 years. While these plans are typically even more affordable, you’ll need to eventually buy another plan when it expires.

Is Life Insurance Worth it in My 20s?

Investing in life insurance in your 20s is a great choice for many, but there are plenty of pros and cons to weigh over when thinking through your next financial decision. Here are some things to keep in mind:

Pros of Investing in Life Insurance

  • Life insurance is generally quite affordable to those in their 20s. Young and healthy investors are cheaper to cover, which means lower premiums for you.
  • Life insurance provides a valuable safety net for loved ones now or in the future. You’ll have a much longer period of death benefit coverage than someone who started later in life.
  • The accumulated cash value of your life insurance may be used while you are alive, creating even more financial benefits for you and your loved ones.
  • Some programs even allow you to increase your coverage at a later date without a new medical exam for your convenience

Cons of Investing in Life Insurance

  • You’ll need to pay premiums for a longer period of time, which can be difficult if you are on a tight budget.
  • Though the plans are affordable, you might prefer to use the money elsewhere while you are in a lower-risk bracket.

Get More Financial Advice with IntentGen

Still not sure whether or not investing in life insurance in your 20s is the right option for you? Feel free to talk with our financial experts at IntentGen. We can help you determine the best options for your wants and needs, so contact us at any time in the Chicagoland area!