Millennial Money Moves: Insurability, Stability and Financial Success
Financial planning might not seem like an immediate concern for millennials and young adults balancing student loans, career aspirations, and personal growth. However, building a strong financial foundation early on provides critical advantages. By taking steps now, such as securing insurability and leveraging tools like cash value life insurance, young people can prepare for opportunities, protect themselves from unforeseen events, and lay the groundwork for long-term financial success.
The Value of Insurability for Young People
Your ability to qualify for life insurance is based on several factors, including your health and age. The earlier you secure coverage, the more likely you’ll obtain favorable terms and lower premiums. Insurability isn’t guaranteed forever—unexpected illnesses or changes in health can limit your options later in life.
Cash value life insurance policies, for example, not only protect your loved ones in the event of your passing but also offer living benefits, such as access to funds in emergencies or during medical treatments. By securing coverage while you're young and healthy, you maximize these benefits.
Why Millennials Need a Financial Safety Net
Unexpected medical expenses and illnesses can devastate a financial plan, especially for young adults. A 2021 study by GoFundMe revealed that a third of the fundraisers on their platform were for medical expenses—a testament to how many individuals lack sufficient financial resources in emergencies. A separate survey by Financial Health Network found that only 23% of millennials consider themselves financially healthy.
Living benefits, available through certain cash value life insurance policies, can provide an essential safety net, ensuring that individuals have access to funds for critical needs without derailing their long-term financial goals.
Using Time to Your Advantage
Time is one of the greatest assets young people have in financial planning. Starting early allows your savings to grow through compounding, creating exponential returns over time. For example, contributing $200 a month to a savings plan with a 6% annual return at age 25 can grow to over $400,000 by age 65. Waiting until age 35 to start reduces the total to roughly $200,000—half as much for the same monthly contribution.
Additionally, starting young provides a buffer against inflation. As the cost of living rises, having strategies to grow and protect your wealth becomes critical. Cash value life insurance policies, which grow on a tax-deferred basis, offer a hedge against inflation and ensure that your purchasing power remains intact.
Building a Financial Foundation
For young adults, financial planning begins with the basics:
Emergency Funds: Experts recommend having 3-6 months of living expenses saved for emergencies. Cash value life insurance policies can complement traditional savings accounts by providing additional liquidity.
Debt Management: Tackling high-interest debt, such as credit cards or student loans, frees up cash flow for savings and investments.
Retirement Planning: Millennials and Gen Z are less likely to have pensions and must take full ownership of their retirement planning. Cash value policies, 401(k)s, and IRAs all play a role in building a secure retirement.
The Rising Need for Living Benefits
Medical advances are extending lifespans, but they come with high costs. The American Cancer Society estimates that 1 in 2 men and 1 in 3 women will be diagnosed with cancer in their lifetimes. Treatment costs for serious illnesses can quickly reach tens of thousands of dollars, creating financial strain for those unprepared.
Living benefits in certain life insurance policies allow policyholders to access a portion of their death benefit for medical treatments, long-term care, or other urgent needs. This feature not only protects the policyholder but also prevents financial burdens from falling on family and friends.
Secure Your Future with the Right Financial Team
Financial planning isn’t a one-size-fits-all approach, especially for millennials balancing multiple priorities. The right financial team can help you identify your goals, create a tailored plan, and adjust as life evolves.
At I.C. Life, we specialize in helping young adults build strong financial foundations through strategies like cash value life insurance, retirement planning, and wealth management. Contact Marissa Cozzolino today to explore how you can secure your insurability and prepare for life’s opportunities and challenges. Visit marissacozzolino.com to fill out the discovery form and take the first step toward financial empowerment.
Preparing for the future doesn’t have to be overwhelming. By starting early, securing your insurability, and putting financial tools in place, you can build a stable foundation, protect yourself against unexpected challenges, and create opportunities for long-term growth. Take charge of your financial future today—your future self will thank you.
References:
GoFundMe (2021). Medical Fundraisers Report.
This study reveals the financial burden of medical expenses for many Americans. In 2021, GoFundMe reported that a third of the fundraisers on their platform were to cover medical costs, highlighting the importance of a financial safety net to manage unforeseen healthcare expenses.
GoFundMe, 2021, Medical Fundraisers Report. Retrieved from: GoFundMe Research.Financial Health Network (2022). U.S. Financial Health Pulse.
The Financial Health Network’s survey on millennials' financial well-being found that only 23% of millennials consider themselves financially healthy. This underscores the gap in financial preparedness among young adults, making the need for financial tools like cash value life insurance even more urgent.
Financial Health Network, 2022, U.S. Financial Health Pulse. Retrieved from: Financial Health Network.American Cancer Society (2023). Cancer Facts and Figures.
The American Cancer Society reports that 1 in 2 men and 1 in 3 women will be diagnosed with cancer in their lifetime, emphasizing the potential financial strain caused by serious illnesses. The inclusion of living benefits in life insurance policies can help mitigate these costs by providing access to funds for treatment.
American Cancer Society, 2023, Cancer Facts and Figures. Retrieved from: American Cancer Society.
