The majority of millennials today in Singapore are tech-savvy, thrifty and tend to care more for their parents, the environment and social causes – this is indicated by OCBC Bank‘s survey of young Singaporeans. They are also all-in about saving more of their salaries. 70% proactively set aside a portion of it as well as showing an interest in buying insurance policies, according to the same survey. But, why aren’t they buying insurance? It isn’t because it’s tough to buy an insurance policy – but maybe because it’s shrouded in misconceptions.
Are Millennials Too Young to Need Financial Planning?
According to Tokio Marine’s study, even though the priority of most millennials is to start saving funds, there are still concerns among these people about the unforeseen situations that lead to financial burdens.
With that being said, young adults are highly flexible to changes and often look for ways to achieve their aspirations as well as building a successful career – which is the overarching goal to create a secure future.
On a brighter note, millennials in Singapore place great emphasis on family values just as much as their dream pursuits. This implies that they do sometimes worry about the well-being of their loved ones.
As stated in the Business Insider Singapore news article, 83% indicated that their life goal is to get a secure job with regular income, whereas 46% mentioned starting a family. In contrast, 30% said that they would like to start a business.
All these are real indications that the millennials have actual needs that financial planning and insurance can fulfil to help them along their way to their goals and aspirations.
Why are Young Adults Avoiding Insurance & Financial Planning?
Based on a survey done by OCBC last year, 69% of Singaporean young adults are keen on purchasing insurance policies, but they don’t know where to start. Knowing that they are at the younger side of the millennial spectrum, they believe that they have plenty of time to buy life insurance. So, it is clear they want insurance cover, but they think they still have time.
Millennials also assume that insurance is expensive and therefore prioritise other commitments ahead of insurance. Part of the problem – which is loosely connected to not knowing where to start – is that many millennials focus more on price than the value in their attempt to live within their means. However, by forgoing some insurance protection, they are exposing themselves to financial risks they could hardly afford.
Furthermore, young adults believe that the insurance acquisition process is tedious and complicated. Some find it challenging to understand the policies, payments, and how they work. While some end up shoving this to the back of their minds and focus on something else, not knowing they have done their future selves big disfavour, others take the plunge to acquire insurance, either on their own or through a financial consultant. Both ways have their pros and cons, but discussing them will be the subject of another article.
Despite these reasons, it is a misconception that millennials don’t want insurance cover. On the contrary, they are very keen on it.
From all these, millennials who delay buying insurance and financial planning could end up inadvertently putting aside immediate benefits that they can enjoy right away – to their own disadvantage.
Benefits of Protecting Your Present and Future
Here are key takeaways to buy an insurance plan sooner rather than later.
Financial Firewall for You and Your Family
You have a family of dependents to protect financially, which is why insurance is crucial. The moment you buy insurance coverage is when the people who matter the most in your life are protected and secured from financial hardship if the unexpected happens.
No matter how secure your financial position is today, unexpected circumstances can unravel all of it very quickly. With the proper insurance plan, you can protect yourself and your family from a painful financial burden. Which plan is good for you? You can find out by either doing your own research, or the more efficient way is to seek the advice of a financial consultant from an Independent Financial Adviser.
Unforeseen hardships such as critical illness, injury or permanent disability, even death – can leave your family with high emotional stress, and even grief. With the right types of insurance in place, your family’s financial burden will be reduced, and the insurance coverage could help you meet certain unexpected expenses, such as medical expenses, including therapy and rehabilitation, long-term care expenses and other end-of-life expenses, most often, funeral costs.
Financial Peace of Mind
No amount of wealth can replace your well-being and health, including the role you play in your family. Therefore, having insurance cover ensures that any disruption to your family’s financial resources in the event of an insured risk comes to pass is mitigated. The peace of mind you get out of this reassurance is priceless.
A Legacy to Leave Behind
With the right types of life insurance and disability income insurance, your family can continue to live comfortably even if something happens to you or your source of income. Smart use of insurance not only secures the financial future of your loved ones but also protects their standard of living until they become of age to earn their own living.
Acquire the Right Insurance Solution Today
Insurance may be the last thing on millennials’ mind, but it’s something that they act on now in order to reap immediate benefits.
Purchasing insurance can be a breeze as you now have a world of options online and offline. The great thing about insurance these days is that you can compare quotes between insurance companies to find what’s best for you. Moreover, financial consultants are available to assist you, so don’t be afraid to ask questions. It’s more important for you to know what you’re buying than to buy based on blind guesses and leave knowledge gaps unfilled.
With that said, Financial Alliance is an ideal provider of independent financial advice for young adults. We offer progressive financial services ranging from health insurance, general insurance and regular savings plans to retirement planning and wealth enhancement through appropriate investments that fit perfectly with your needs and wants, regardless of your background and phases in life – so, do explore Financial Alliance’s personal finance plans.
To get to your financial goals even faster, contact us today. Our Financial Consultants will listen to your financial goals and guide you in planning ahead. Your future self will thank you for this favour you have done today.