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4 Life Insurance Plans Millennials Can Consider

iQuanti: When you’re relatively young, life insurance may be one of the last things on your mind. However, a life insurance plan can be essential when it comes to helping financially protect your family from an unplanned tragedy.

What’s great about being a millennial is that since you’re still younger, that means you may also be in good health. Possibly, you could use this to your advantage to lock into the lowest rates possible for decades to come.

Of course, getting coverage has to be balanced against cost as well as your other financial priorities. With that point in mind, here are four types of life insurance plans that millennials should consider getting and why.

Term life insurance

Term life insurance is usually the simplest form of life insurance you can get. It pays a death benefit for a specific number of years (called the term), such as 10, 20, or 30 years. Because it only provides a death benefit, it will be the least expensive among all other types of life insurance.

How it benefits millennials: Young families who are just starting out but don’t have a lot of room in their budget can purchase lots of coverage by getting a term life insurance plan. By applying while you’re still young, you possibly can lock into a 30-year contract and pay the same low rate into your 50s and 60s.

Whole life insurance

Whole life insurance is a basic form of what’s known as permanent life insurance. Unlike term life insurance, whole life insurance will last your entire lifetime. The other major difference is that it comes with both a death benefit and a cash value component.

Cash value is a lot like a savings account that accumulates within the life insurance policy itself. Many upper-class individuals and corporations often pursue life insurance policies with cash value because they see the benefits of it.

How it benefits millennials: As mentioned before, younger people should be able to lock into the best possible premiums. Since this is a life insurance policy that you will have for your entire life, that means your premiums will be minimized while the cash value has ample time to grow.

Variable universal life insurance

A variable universal life insurance policy is another type of permanent life insurance. However, the death benefit can be adjusted so that there’s some flexibility in the premiums you pay. On top of that, the cash value is invested in equities for potentially higher gains.

How it benefits millennials: People who like the appeal of a permanent life policy but can’t afford the higher costs of a whole life policy may find variable universal life insurance to be much more flexible. In addition, since investing is a long-term game, millennials may find they have the upper hand in purchasing a life insurance policy that will have several decades of equity growth.

Indexed universal life insurance

While there’s a lot to love about variable universal life insurance, one of the drawbacks is that if the stock market goes down, there can be losses to the cash value. To work around this, the industry offers an alternate product called indexed universal life insurance.

Indexed universal life insurance is a life policy where the cash value invests with guard rails. There is a limit to how much you can earn, but there is also a lower floor preventing you from taking any losses against your cash value.

How it benefits millennials: Indexed universal life insurance is a win-win option. Not only do you get the flexibility to adjust your premiums, but it also allows the policyholder to invest without the fear of market losses.

The bottom line

While many young millennial families can utilize term life insurance to fit into their budgets, they may also be in a position to apply for permanent life insurance policies like whole life, variable universal life, or indexed universal life plans. Since many millennials are in peak health, they may qualify for the best possible premiums. Over the long term, this will help them to maximize the growth potential of the policy while also helping provide a sufficient death benefit.

Coverage is underwritten by Aflac.
Aflac does not offer Variable universal life insurance or Indexed universal life insurance.

In Arkansas, Idaho, Oklahoma, Oregon, Pennsylvania, Texas, and Virginia, Policies: ICC1368100, ICC1368200, ICC1368300, ICC1368400 and Riders: ICC1368050, ICC1368051, ICC1368052, ICC1368053, ICC1368054, ICC1368055. This is a brief product overview only. Coverage may not be available in all states, including New York. Benefits/premium rates may vary based on plan selected. Optional riders are available at an additional cost. The policy has limitations and exclusions that may affect benefits payable. Refer to the policy for complete details, limitations, and exclusions. For costs and complete details of the coverage, please contact your local Aflac agent.

Information herein is intended to provide general guidance and does not constitute health, legal, tax, or accounting advice regarding any specific situation. Aflac cannot anticipate all the facts that a particular employer or individual will have to consider in their benefits decision- making process.

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4 Life Insurance Plans Millennials Can Consider

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