Life is full of surprises, and many of them can be quite expensive.
Imagine yourself unexpectedly ill and in the hospital. Or your precious laptop is stolen from your car. Even worse, imagine if there is a sudden death in the family and aside from the tragic circumstances, there’s uncertainty how income will be replaced.
What do these situations have in common? Insurance can help alleviate the financial costs of these cases and make them easier to get through. But you still may be wondering: “Do I need insurance?”
Many of us are dealing with student loan debt repayment and are focusing on other financial priorities, so insurance often falls to the bottom of the list.
When you are young, it’s easy to dismiss the importance of insurance and think, “that won’t happen to me!”
But things do and will happen. Will you be financially prepared to deal with the ramifications? One minor slip up can derail your student loan repayment or savings goals.
Check out these three types of insurance that can help protect you and your financial future.
Just a few years ago, I was working part-time, so I was not eligible for my employer’s health insurance. I was too old to be on my parents’ health insurance, so I had to make a choice: Do I buy my own health insurance or not?
At the time, I wasn’t making very much money, and I was focused on repaying my student loans. So I opted not to buy health insurance.
For two years, I carefully navigated life without the safety net of health insurance. But one surprise incident put me into the hospital.
The bill? Over $1,000 dollars.
When this happened, I was mad at myself for thinking that I could stay in good health without ever having to spend a dime on healthcare costs.
Things have changed drastically since I went without health insurance a few years ago. Now healthcare is (hopefully) more affordable for those who couldn’t afford it before thanks to the Affordable Care Act.
Even with sweeping changes to the healthcare system, there will still be some people that go uninsured — by choice.
If you are wavering on getting health insurance, consider the costs of:
- A doctor’s appointment
- An emergency room visit
Having health insurance can give you peace of mind and lower your out-of-pocket costs when you need care. I’m still shocked about how much I pay for things with insurance, but when I see the full costs for appointments and medications, I’m grateful I have it.
If you don’t have health insurance, you might be self-employed or working part-time. If you are curious and thinking “do I need insurance?” ask yourself if you can afford a health emergency.
There may be lower-cost options if you need to buy health insurance yourself. You can browse plans on browse plans on eHealthInsurance to get an idea of what the monthly costs of purchasing your own insurance are.
When we are healthy, it’s easy to think that we are young and invincible, and health insurance is just another added cost. But one unexpected illness can put you in a financial rut.
Another important type of insurance to consider is renter’s insurance. Having renter’s insurance can protect you and your belongings in a variety of situations.
If there is an unexpected leak or fire in your apartment building and your stuff gets ruined, renter’s insurance can help cover the costs of your belongings. Don’t expect your landlord or your apartment complex’s insurance to cover your belongings in such a situation.
Aside from this case, there are some pretty unique things that renter’s insurance covers.
- It typically covers the costs of stolen items both inside and outside of your apartment. So if your laptop is stolen from your car, your renter’s insurance could help cover the cash value of the computer to get a new one.
- Most renter’s insurance policies come with some form of personal liability. So if you are hosting a party and someone gets hurt in your apartment, your personal liability may be waived up to your coverage amount. The renter’s insurance could help cover any associated medical costs if you were found at fault, or if you are sued.
I know all this because I recently got on the renter’s insurance train after hearing about my friend’s laptop being stolen. The first question everyone asked her was, “Do you have renter’s insurance?” She didn’t.
Since I make my living from my computer, I’d be hard pressed to find the cash to cover everything.
It seems that my friend and I were not alone either. According to a recent poll from the Insurance Information Institute, 95 percent of homeowners said they had homeowner’s insurance while a mere 37 percent of renters said they had renter’s insurance.
The surprising thing is that renter’s insurance is amazingly cheap compared to what it covers. You can generally find renter’s insurance rates between $10-$20 per month! Liberty Mutual offers renters insurance for “pennies a day.” The total cost of my renter’s insurance for one year was $167 — and that is $167 for my peace of mind.
Renter’s insurance is a good option for most people as it covers things your landlord won’t and often covers your belongings inside and outside of your home.
As a young adult, blooming into full-fledged adulthood, you start to take on more responsibilities. Maybe you pursue homeownership, get married, or start a family. All of these life changes dramatically shift your financial situation as well as your financial responsibility.
If you have kids and/or have one partner that relies on your income, getting a life insurance policy can protect your family and their financial future should something happen to you.
Yeah, death is never a fun topic to talk about. But money and death? Even less fun.
In case of death, a life insurance policy will pay out a lump sum to your beneficiaries, such as your family, to help cover associated costs and recoup the loss of income.
If you are single, in a relationship, or married with no kids, a life insurance policy might not be necessary.
But life insurance is often recommended if one person relies on the other financially. If you have questions, it never hurts to speak to a professional.
I used to think, “Do I need insurance? Psssshhhh. I’m young and it’s too expensive!” But now I’m so grateful to be properly adulting and protecting myself, my belongings and my money.
Do you have these types of insurance? Why or why not?
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
|Lender||Variable APR||Eligible Degrees|
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1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 5.87% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 5.87% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at firstname.lastname@example.org, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
Savings example: average savings calculated based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were disclosed. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
Application detail: 5 minutes indicates typical time it takes to complete application with applicant information readily available. It does not include time taken to provide underwriting decision or funding of the loan.
Instant rates mean a delivery of personalized rates for those individuals who provide sufficient information to return a rate. For instant rates a soft credit pull will be conducted, which will not affect your credit score. To proceed with an application, a hard credit pull will be required, which may affect your credit score.
Total savings calculated by aggregating individual average savings across total borrower population from 9/2013 to 12/2017. Individual average savings calculation based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were provided. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate||Visit SoFi|
|2.47% – 5.87%1||Undergrad & Graduate||Visit Earnest|
|2.47% – 8.03%4||Undergrad & Graduate||Visit Lendkey|
|2.95% – 6.37%2||Undergrad & Graduate||Visit Laurel Road|
|2.48% – 6.25%5||Undergrad & Graduate||Visit CommonBond|
|2.72% – 8.32%6||Undergrad & Graduate||Visit Citizens|