Life insurance may not be a top priority for people in their 20s, but could be one of the most valuable purchases they ever make if the unfortunate were to happen.

The most simple way to determine if you need life insurance is to ask yourself this question, “if I were to die tomorrow, would it have a financial impact on anyone?”

If the answer is yes, you need a policy. Luckily, you are young, hopefully healthy, and should qualify for very low term life insurance rates.  

Based on the financial impact your death would cause, you can determining how much insurance to purchase and over what term.  Working with a Financial Planner can help you to not only calculate these needs, but figure out how they will change over time and at what point, if any, you will be able to self-insure.  By layering policies together, you can decrease the long-term cost of the coverage as you are essentially “locking in” today’s rates. Things to think about are any debts left behind, ongoing living expenses for current dependents, financial goals for current dependents, and end of life costs.

If you do not yet have any children, but plan to start a family in the future, a life insurance policy is there to protect your spouse and children. Life is full of unknown possibilities and choices, thus you need to keep your loved ones covered. A strong financial portfolio is one of the most important things one can build in their lifetime.  When bought at an early age, a life insurance policy can be a very effective way to protect it. 

There are different insurance policies available with their own pros and cons. It is important to understand your own financial situation when determining the best policy for your needs.  A Certified Financial Planner can help guide you through this process.