You’ve just graduated college. You’re on top of the world, feeling proud and independent. Fresh faced to the adult world, you’re ready to prove yourself. While many things may be swirling your mind, your first step into adulthood may be getting your finances in order and working toward lowering your debt. You may have tunnel vision of getting out of debt, but what about protecting your family against your debt - this is where life insurance comes in.
Each graduate’s life looks a little different. But there are three main people you may want to protect depending on your situation: your parents, your spouse, or your children.
Life Insurance to Protect Parents
As a student who recently graduated, you most likely have loan debt considering the average student debt in 2017 was $37,172.1 Depending on the type of loans you have, your passing may cause your debt to transfer to your parents. Most of the time, federal student loans are discharged, however private student loans may not be. Usually, private student loans require a cosigner. That debt may be passed along to the cosigner, and the company could require those funds to be paid back immediately.2 Life insurance could help reduce the financial burden and ease their minds.
Life Insurance to Protect a Spouse
Coming out of college, you may be recently married. That means you take on the debt of the other person, and they take on your debts as well. By having life insurance you can aid in the protection of your spouse’s finances2.
Life Insurance to Protect Children
Perhaps your post-graduation life involves a child. You may want to consider getting life insurance, especially if you are the main provider of income for the household. This can help to ensure your new family has income protection and funds to help pay for your child’s education one day2.
Typically, a recent graduate may be wondering what others their age are doing about their life insurance situation. There are two types of life insurance that can be bought: term life insurance and whole life insurance. Generally, college graduates go for term life policies because they tend to be cheaper than whole life insurance policies and they provide a smaller amount of coverage, which could be a good option for someone who doesn't have a lot of assets. You may want to consider how much loan debt you have when deciding the coverage you wish to have.
If you’re thinking about how you don’t have student loans, a spouse, or children, some believe it’s a great time to get life insurance because your premiums might be the lowest they’ll ever be. You are young and most likely in great health which are two things that can play a large part in the pricing of your policy.
Be mindful of others when taking this new step into independence. Protect yourself and the ones around you, regardless of what your fresh new life looks like.
Categories: Insurance, Life Insurance, Term Life Insurance