INSURANCE FOR 20 YEAR OLDS!
Let’s be honest, many people don’t think Insurance is necessary for them until they find themselves in a situation where they wished they had it. And this is especially true when you are young and carefree. Regardless of your age insurance is important for you.
No matter how old you are Insurance will buy you peace of mind, in the event that a risk occurs. As a rule of thumb, before buying any insurance ensure that you first do a needs assessment that will inform you which insurance policy is important for you and will address your needs. For instance If you're in your 20s, you're more likely to be single and maybe without a child. Just because you have no dependents is no excuse not to get an insurance. There are several insurance policies worth considering in your 20s.
Your health is paramount. Being young doesn’t mean that a health insurance policy is unnecessary. One of the myths young people have is that they are hale and hearty, and not vulnerable to diseases or illnesses. The truth is that health insurance is not just for older people. If anything when you take up an insurance cover at a young age, it is more cost effective and you will pay lower premiums as opposed to when you take up the policy at an older age. Only when you have some peace of mind about your health can you focus on working hard and make a living.
In some instances if you are employed, you are likely to have a health policy provided for you by your employer. However if that doesn’t happen or if you are in between jobs, are a freelancer or self-employed, consider as a basic requirement enrolling in the NHIF scheme and paying individual premiums to enable you get covered. This is a good place to start and as your income increases you can upgrade to a medical health insurance cover.
Pension Insurance Scheme.
Yes you read that right! While it is understandable that in your 20s you are just beginning your career life and therefore retirement is the furthest thing on your mind, consider taking up a pension scheme as an investment or savings opportunity. Some employers offer a pension plan that lets the employee contribute a percentage of their salary whereas the employer puts in money of their own and the combined funds are invested for growth. With pension schemes you earn a compound interest hence your money grows over time; a simple force that literally causes your wealth to snowball.
It is worth noting that chances are that you will get tax relief on your pension and therefore your costs are minimal. Also over time, the returns you earn on your pension are reinvested over and over, for years. Taking up a pension scheme early is great as you get to save money more over a period of life.
In case you purchase a car, an auto insurance is a must have. If anything, the Motor vehicles act states that a third-party motor insurance policy is a must for all vehicles on public spaces in Kenya. Also consider getting a comprehensive car insurance as this covers theft or fire, physical damage of the insured vehicle and also includes third party property damages, bodily injuries and legal liability of the insured. The policy will compensate the insured for any costs arising out of an accident, theft, flooding, earthquake or fire. The main difference between a comprehensive and a third party only (TPO) cover, is that TPO covers costs and damages to the third party property and bodily injuries and is the minimum cover policy required by the law.