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Life Insurance for Millennials: Simple, Affordable Options

December 06, 2023
Our goal is to educate and advise on life insurance options, so you can feel confident in making the right choice, whether that’s through Quotacy or somewhere else. To ensure we provide accurate and trustworthy information, our writers follow strict editorial standards.

Table of Contents

Millennials, also known as Generation Y and the Net Generation, were born between the early 1980s and early 2000s. This demographic group is characterized by four key traits that significantly influence their perspective on life insurance: they are tech-savvy, skeptical, often overwhelmed, and financially uncertain.

Tech-Savvy Millennials

Growing up in the digital age, millennials are accustomed to instant gratification thanks to the Internet. Term life insurance, which is the most common, most affordable, and typically the best option of life insurance, has no instant gratification other than peace of mind.

Skeptical by Nature

Millennials, despite being open to unconventional ideas, harbor skepticism. Many doubt they will ever benefit from their monthly contributions to Social Security. There’s also a lack of trust in the healthcare industry, leading some to explore holistic health alternatives.

For many millennials, the concept of their loved ones receiving a payout in the event of their untimely death, even when faced with remarkably affordable term life insurance options, may appear intangible and not worthy of a second thought.

Millennials should know that life insurance isn’t a new idea that may not pan out. It’s iron-clad protection for the people you love. Once your policy is inforce, your family is protected as long as that coverage is active. If you die unexpectedly during the term, the insurance company pays your beneficiary the full death benefit.

The Burnout Generation

Nearly half of millennials have side hustles, with many relying on this income to make ends meet. Despite their youth, millennials are more prone to workplace burnout compared to older generations.

This generation is often reluctant to spend their precious time meeting with life insurance agents. They might defer this decision, thinking it’s something they can address later.

Financial Uncertainty

Millennials face the challenge of securing well-paying jobs while juggling student loans, homeownership aspirations, and retirement savings. Some experts believe this generation confronts more economic uncertainty than any since the Great Depression.

Many millennials assume that purchasing life insurance is a complex and expensive process. What they might not realize is that life insurance has evolved.

See what you’d pay for life insurance

Comparison shop prices on custom coverage amounts from the nation’s top carriers with Quotacy.

Life Insurance for Millennials

If you’re a millennial exploring getting life insurance, let’s begin with the fundamentals to ensure you grasp what’s essential.

Life insurance is a contract between the policy owner and life insurance company. In this agreement, the insurance company commits to paying a death benefit if the insured person passes away while the policy is in effect, as long as the policy owner continues to make the premium payments.

There are two categories of life insurance: term and permanent life insurance.

Term Life Insurance

Term life insurance offers temporary coverage, typically lasting between 10 to 40 years, depending on the specific term you select. If you happen to pass away while the coverage is active, your beneficiaries will receive a tax-free death benefit.

Due to its temporary nature, term life insurance is known for being cost-effective, making it a budget-friendly option for many.

Quotes for Monthly Cost of a $250,000 30-Year Term Life Insurance Policy for Healthy Non-Smoking Individuals in Their 30s
30 $17.89 $15.43 
31 $18.15 $15.87 
32 $18.72 $16.12 
33 $19.43 $16.60 
34 $20.19 $17.18 
35 $20.80 $17.86 
36 $21.91 $18.56 
37 $22.95 $19.51 
38 $24.65 $20.63 
39 $26.18 $21.60 

Even though a term life insurance policy does come with an expiration date, many policies offer renewal or conversion options.

  • Renewing a term policy – This option allows you to maintain your existing coverage for an additional year. However, it’s important to note that the fixed rate you initially secured no longer applies. When renewing your coverage, you’ll be subject to renewal premiums, which increase each year you opt to renew your policy.
  • Converting a term policy – With this option, you have the flexibility to convert a portion or the full amount of your term coverage into a permanent life insurance policy. Be aware that some policies come with a conversion expiration date, so it’s crucial to carefully review the policy details. The premiums for your policy will be adjusted to reflect the costs of the permanent coverage.

Learn more about the options you have if your term coverage is coming to an end: What Happens When Term Life Insurance Expires?

As an independent broker, we offer many term life insurance coverage options. You’re sure to find a policy that fits your needs and budget. See policy options and get quotes instantly.

Permanent Life Insurance

Permanent life insurance offers lifelong coverage, ensuring that your beneficiaries will receive a payout regardless of when you pass away. This type of policy includes various options, such as whole life and universal life insurance, each with its unique features and advantages. One key benefit common to permanent life insurance is cash value accumulation. This serves as a savings component, where a portion of your premium payments is set aside and earns interest over time. Policyholders can access this accumulated cash value through policy loans or withdrawals.

While permanent life insurance may sound like an attractive option, it’s essential to consider some drawbacks. The cost of permanent life insurance is considerably higher than that of term life insurance. Additionally, failing to repay a policy loan can result in a reduced death benefit for your beneficiaries.

Comparing Monthly Rates for $250K Policies for a Healthy Non-Smoker (Male) 
Age 30-Year Term Policy Universal Life Policy Whole Life Policy 
30 $17.89 $122.70 $195.36 
35 $20.80 $144.36 $234.75 
40 $27.84 $163.36 $294.39 

Permanent life insurance can be beneficial in many situations, but the policy owner needs to ensure they can keep up with the payments long term. Before purchasing a whole or universal life policy, make sure you understand the terms. Permanent policies can be quite complex.

Cost-Saving Tips to Find an Affordable Policy

Fortunately, there are ways to purchase a life insurance policy to fit in most budgets. Here we provide practical tips for saving costs while maintaining comprehensive coverage.

  1. Buy Term. Due to its straight-forward coverage and temporary nature, term life insurance is one of the most cost-effective options. You can lock in a low premium for a term up to 40 years.
  2. Compare Rates. Use online platforms, such as our term life insurance quoting tool, to compare quotes from various insurance companies. This will allow you to easily explore your options before deciding on a policy.
  3. Adjust Coverage Amounts. Term life insurance is very customizable with coverage amounts and term lengths. Talk with your agent about financial responsibilities and the needs of dependents to avoid over-insuring.
  4. Make Healthy Choices. Your health has a direct impact on your life insurance premiums. Non-smokers, individuals with healthy BMI, and those with minimal health risks often qualify for lower rates.
  5. Consider GUL. If your family’s needs require permanent coverage, consider a guaranteed universal (GUL) policy instead of whole life. A GUL policy provided lifelong coverage, like whole life, but has fewer bells and whistles, making it less expensive.

Get Quotes Today from Quotacy

It’s important to incorporate life insurance into your financial plan if you have anyone depending on you. Life insurance serves as an essential safety net for your loved ones in the unfortunate event of your passing.

Getting life insurance has never been easier. Start the process by getting free and instant term life insurance quotes.

Compare options and apply right online in just a few minutes. Once your application is submitted, a dedicated Quotacy agent will be assigned to you, working diligently to ensure you receive the best price possible and guiding you through every phase of the process.

Bonus: If you’re in your 30s and 40s, you may be eligible to skip the life insurance medical exam. This streamlines the buying process. In some cases, you can find out if you’re approved in 24 hours or sooner. Your agent will let you know if this option is available to you.

Unsure how much life insurance you need? Try out our online life insurance needs calculator.

Note: Life insurance quotes used in this article are accurate as of December 6, 2023. These are only estimates and your life insurance costs may be higher or lower.

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