Generation Y Do I Need Life Insurance?
Mar 22, 2017
Millennials, also known as Generation Y, are a fascinating demographic to explore when it comes to financials. In the US, this generation collectively has $1.3 trillion dollars in student loan debt. They also are set to inherit $30 billion from the Boomer generation in the upcoming years. That’s a lot of spending power! These two figures show the dichotomy that Millennials face financially. Although they will have huge spending power, most of their financial focus currently is on reducing their debts.
A recent study by LIMRA suggests that this generation also has a huge misunderstanding about purchasing life insurance. A whopping 41% of Millennials surveyed said they did not believe they would qualify for life coverage. Let that sink in for a moment. This vibrant, young, healthy generation doesn’t believe they’d qualify, when they are arguably the MOST eligible for affordable coverage.
We don’t posit these numbers to discourage advisors; quite the opposite, in fact. Those numbers are an opportunity to reach a group of individuals who have a true need for life insurance, but simply lack the basic knowledge. That’s where advisors can step in and be their guide to purchasing a policy that works for them. Here’s what Millennials need to know:
Paying off their debt is important; but so is protecting their loved ones from inheriting that burden. If the worst should happen, sometimes their student loan debt doesn’t disappear. If they have a private loan, the debt will be transferred to their parents, spouse, or other cosigner on the loan. With this in mind, why is life insurance not at the top of their list of priorities?
Purchasing life coverage can be quick and easy. Millennials want their purchases to be convenient. Remember, they can buy anything off Amazon with the click of a button. There are a wealth of life products out there that offer e-apps and fast underwriting times. Some are even same-day issue like Speed of Life Term.
Their age is a financial advantage. Millennials are still working with tight budgets. It’s important to let them know that the best time to get a life insurance policy is RIGHT NOW. It’s a simple formula: younger = cheaper. A 25-year old pays about 50% less a month compared to a 45-year old for the same amount of coverage.