How life insurance can help provide stability for millennials

Life Events

The lives of today's young Americans look a lot different than those of previous generations. As a millennial, you may be keen on leading a life unlike your parents’ by bucking the traditions that marked the progression of your predecessors. Maybe you want to focus on your career before getting married or having kids. Perhaps you’ll work a few years before going to college. These new life paths come with some degree of uncertainty. Life insurance can help provide financial support for your loved ones no matter when you choose to take on life’s major milestones.

Have you been postponing milestones?

Many millennials are delaying and even avoiding major life milestones, such as getting married1 and buying a home2.  This kind of lifestyle management isn’t uncommon. In fact, between 2004 and the second quarter of 2016, homeownership among adults under the age of 35 plummeted from a record high of 43.6 percent to a record low of 34.1 percent.

Writing for the National Association of Home Builders, housing policy economist Josh Miller coined the term the "Great Delay" to describe this phenomenon3. He suggested that the fallout from the Great Recession, mixed with the burden of massive student loans, has created an uncertain economic outlook for Americans aged 24-35.

Similar data from the U.S. Census Bureau shows a rise in the average age for marriage and household formation, supporting the idea of a Great Delay4.

Despite postponing these milestones, there are some important life decisions that you should not put off.

Putting off life's milestones may also impact some major financial decisions. Do you have a plan for your loved one's financial security in the event something happens to you?  

No reason to put off purchasing life insurance

While shelving the idea of purchasing of a home or delaying a marriage to focus on a career or other priorities might make sense for some individuals saddled with debt, it could also impact decisions about other major life choices, such as a buying a life insurance policy.

Starting early may cost you less

You might think that since you don't have a spouse or own a home, you don't need to consider life insurance. But this isn’t necessarily always true. Just because you might not yet be married with kids, it doesn't mean you won't have a family in years to come. In the meantime, being young might provide you an advantage.  Although each individual’s scenario is different, in general, life insurance costs less and is easier to get when you’re younger and healthier.

Your policy can help you accumulate cash

In addition to providing coverage in case the unexpected happens, a whole life policy can also accumulate cash value.  This is money that may be available to use in the future for things like a down payment on a new house or tuition for a child’s education5.

Job change won’t impact your coverage

Many people forget that when you have a life insurance policy through work, individuals can end up without coverage for periods of time between jobs. Additionally, your premiums could increase at a new job if your health, age or other factors have changed since the last time you applied for insurance. Having personal life insurance can provide reassurance in these times of transition.

The road ahead

Millennials can be innovators, disruptors and change makers—this applies to their own lives as much as it does to the culture they’re now driving. In the face of this unpredictability, purchasing life insurance now can potentially help provide the financial security you and your family may want in the future. You should be free to live your life how you want and reach your personal milestones when you choose. And no matter which route you decide to take, life insurance can be there to help your loved ones along if things don’t go as you have planned and you pass away before you expected.

5Policy loans and withdrawals will reduce cash surrender
value and death benefit. Policy loans are subject to interest charges.
If your policy is a modified endowment contract, loans and withdrawals
may be subject to taxes and penalties.

Farmers New World Life Insurance Company, 3003 77th Ave. SE, Mercer Island, WA 98040.

IC-1116-A     01/17