Eight Reasons Why Young People Need Life Insurance

Episode 333 – Do young people need life insurance? Here are eight good reasons why they might.

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Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, think you’re too young for life insurance? Maybe not.

Life is rarely simple, even if you’re part of Generation Z. And if you’re just starting out, life insurance may not be high on your priority list. But there are some reasons why, even if you haven’t thought about it, you may want to consider getting life insurance, even at a young age. Here are eight of those reasons

Existing debts. Do you have student loans, or a new mortgage that was co-signed with your parents? If you were to die, your parents might end up saddled with your debts. It may be a good idea to get enough coverage so that those debts are covered if you aren’t there to pay them back. Is anybody relying on you? Many people never even think about life insurance until they start having children. But are there others who could be hurt financially by your death? A surprising number of successful young people play an important role when it comes to helping out their parents, siblings, and extended family.[1] The cost. Even if you’re not sure whether you need life insurance now, you’re more likely to need it in a few years. Whether it’s term or permanent, regardless of what type of coverage you need, premiums are generally less when you’re young. Buying a policy before major health issues arise gives you a chance to lock in a lower premium. This is especially beneficial with permanent coverage. Are you a new business owner? There seem to be so many social media influencers, Tik Tok stars and YouTube millionaires these days. Some new businesses experience dramatic growth. What if your business takes off? What if you have some debt to support your business, even if it’s short-term debt? If you have a partner in a successful business, life insurance takes on increased importance. If you or your partner died, the other would likely want to buy the deceased’s share. How do you fund such a purchase? In many cases, a buy/sell agreement funded with life insurance makes a lot of sense. The death benefit is used to provide the funds you need to buy out your deceased partner. Further, life insurance can help support ongoing business operations and growth during a difficult time. Having adequate liquid funds can be crucial to ongoing success. In the event you die, your partner will have adequate funds to buy your share and support your family. You might not get another chance later on. It’s a simple fact of life that our health tends to decline as we get older, with the likelihood of things like diabetes, heart disease and cancer all increasing. Permanent coverage obtained at a younger age can be a great hedge against future uninsurability. Everyone becomes uninsurable eventually. It’s just a matter of when, and we rarely have enough advance notice. It can provide access to cash later on. A permanent whole life insurance policy builds cash value over time as you pay your premiums, most of which can be accessed at any time and for any reason through a policy loan. And in the future, the cash value can be used as a pool of money when your emergency fund may be insufficient. It can also be used for things such as a wedding or a down payment on a home. Just note, policy loans reduce the policy’s death benefit and cash surrender value. Peace of mind. Life is unpredictable more often than not. Life insurance can help give you peace of mind because you believe that your loved ones will be taken care of financially, even if you’re no longer there. Having this type of financial safety net might help you rest easier.

It’s easier than you may think. Gone are the days when it took months to get a new policy. The overall process is much simpler and often less invasive than it used to be. Nowadays, many companies, including Security Mutual Life, offer an accelerated underwriting review to speed up the process.

For a young person, perhaps the most difficult part of getting life insurance is simply getting started. Your Security Mutual Life insurance agent can help. He or she will assemble your team and coordinate with your attorney and tax professional to review your situation and to determine the insurance plan that will best suits your needs and objectives.

[1] Ma, Myles. “Think You’re Too Young for Life Insurance? 4 Reasons You May Need to Think Again.” Investopedia.com. https://www.investopedia.com/think-you-re-too-young-for-life-insurance-4-reasons-you-might-need-to-think-again-8752961 (accessed April 21, 2025).

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This podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information. 

The information presented is designed to provide general information regarding the subject matter covered. It is not to serve at legal, tax or other financial advice related to individual situations, because each person’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.

To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and X (formally Twitter). Thanks for listening, and we’ll talk to you next time.

Tax laws are complex and subject to change. The information presented is based on current interpretation of the laws. Neither Security Mutual nor its agents are permitted to provide tax or legal advice.

The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state. 

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