Moving from student life into the working world is one of the most exciting milestones. It’s a time in your life when you go from depending on your parents to standing on your own two feet; earning your own cash and deciding on how it gets spent. That last bit is going to depend not just on how much you’re earning, but on where you’re starting from.
Some people step out debt free with a car their parents bought them (the lucky few). Others have a student loan that needs to be repaid and a car that needs to be bought, and their folks just don’t have that sort of money. Still others may have people in their family who will start depending on them for financial support the minute that first paycheck arrives.
That might seem like a bit of a downer. I mean, you’re still young, right? You’d like to live a little, no? What you probably want is to find a balance between your adult responsibilities (paying the bills and protecting your future) and having some unforgettable experiences (like waking up at a music festival in a tent that feels like you were transported to the surface of Mars overnight).
We think, it shouldn’t have to be an either/or situation. And, although your starting point may be a bit more challenging than others’, it doesn’t have to set the tone for your entire journey. By applying a little bit of money savvy now, you can take care of the basics, live in the moment, and plan for the wealth of your future self.
Get insured. Say what now?
There’s nothing sexy about life insurance. If you had to choose between paying a monthly premium for a policy to get some invisible benefit you’re only going to care about when you’re no longer around to care about stuff or say, paying for an internet connection; the internet wins every time. We get that.
Like wifi, you can’t see life insurance. And, also like wifi, if you don’t have it when you really need it, you (and people you genuinely care for) can find yourself in a world of pain. You see, what you may not realise is, life insurance can be one of your smartest, most essential life hacks, ever.
Allow me to enlighten you.
But I’m young, can’t life insurance wait?
Here’s a little secret: the younger you are, the less it’ll cost you to be insured. In other words, your premiums will be lower because insurers charge more for risky people (they tend to be the ones who claim more) and when you’re young, in general you’re more healthy as well, which makes you less risky.
But also, are you going to use your age as a reason to not get financially clued up forever? Don’t you want to be in control of your money sooner rather than later?
But I’m single, why do I need life insurance?
Do you have debt: credit card, student loan, maybe a home loan? Do you support someone financially: a parent, a child, a sibling? Do you have a business (even a small one on the side)? Are you human: could you get ill or disabled; could you die?
Assuming you have a pulse, you need to check out this life insurance thing because being young and single doesn’t mean you don’t need protection from risks. And that’s exactly what life insurance is; it protects you (your most important asset) from risk. Not all risks may apply to you, but at least this first one does.
Protect Your Salary
If something happened to you and you couldn’t work anymore, you’re going to want something that pays out a monthly sum to replace the salary you lost and perhaps a lump-sum as well to cover the initial costs . For this there’s income protection and disability cover, and you can think of these as your gateway to life insurance, because they’re great products to start with: no family and no dependants required. And, they’re even more crucial if you are supporting someone financially.
Sadly, it’s really hard to graduate and get yourself set up without incurring some debts these days. Covering your debts (especially those that are cosigned) is a biggie because, without life insurance, someone else could end up having to take those on. Maybe it’ll be your parents, grandparents, brother or sister, or even a business partner. Here life insurance settles things like your outstanding credit card debt, your student loan, vehicle loan, or even a home loan, etc.
No one is an island. You may not have kids, but you probably have a family or a couple of close friends. For you (and more importantly for them) there’s funeral cover. These guys are going to have a much better memory of you if you happen to have a funeral policy when you die that can pay out a lump-sum to cover your funeral, and tie up your estate.
Exist in Style
Despite all these very valid reasons for having life insurance, it’s probably always going to bum you out each month as you watch the premium leave your account, knowing that you’re paying for something that may never happen to you and that you won’t get anything back. We completely agree. This is the worst. But it actually doesn’t have to be that way.
At Sanlam Indie, for every premium you pay, we put money into your very own investment account at no extra cost to you. And, it literally pays to get covered with us when you’re younger because, before age 31, we match each premium 100%. So, while you’re being covered for the stuff that may never happen to you, you’re growing your wealth through an investment. It’s insurance for the living. And that, friend, is the ultimate life hack.
In less than 10 minutes you can be on the path to living your best life now and planning for the future.