What they didn’t teach you before you received your diploma
The big day is here. You are being set free into the real world, armed with a vast landscape of knowledge and ready to take on new challenges. Maybe you have already landed that big dream job. Perhaps you have set your sights on your first home or a place to rent. Now all of the logistical challenges take hold, and you may have not yet learned how to navigate this new world in all its practical glory.
One important post college necessity your school may not have taught you about is insurance (unless of course you were a finance major!). Insurance is a critical component to getting you set up in the real world. Why? It will protect you when you need it most. Your parents likely covered this for you through college, but for most insurance needs, you are now on your own.
Keep Healthy
If you are graduating with a job, your new employer may offer health insurance, which is a great benefit. If your employer does not, however, or you are still job-hunting, fortunately you won’t be left without coverage. Passage of the Affordable Health Care Act included a provision that allows children to stay on their parents’ health insurance plan through the age of 26.
Whatever you do, don’t assume that because you are young and healthy that you don’t need health insurance. If you get sick or are in an accident, your health care coverage could keep you from going into severe debt to pay for medical expenses.
Protect Your Stuff
If you lived in a dormitory during college, your parents’ homeowners policy likely protected your belongings, but they will no longer be insured when you rent on your own. Renter’s insurance is an important, and often inexpensive, policy you don’t want to be without. While you may not think you have a lot of value in your items, imagine replacing everything you own if a fire occurred in your apartment. Clothing, kitchenware, computers, furniture, electronics – it adds up pretty quickly if you need to replace all of your belongings at once.
Renters insurance may also protect you in other ways including medical and legal expenses if someone is injured at your rental and sues you. Your policy may also cover your belongings while you are away from home, and may even cover belongings you have borrowed or rented that become damaged or lost while in your possession.
Auto Insurance
Most states require auto insurance with a minimum required coverage of liability insurance to cover damage and injuries you may cause to a third party, but you will want to consider more than the minimum required by state law. What kind of coverage and the limits you select vary on your circumstances (use and value of vehicle for example), but, to fully protect yourself, you should consider liability, collision, comprehensive and medical coverage when selecting a policy.
When to Consider Life Insurance
If your parents co-signed your student loans and you have a lot of debt, you may want to consider a life insurance policy naming your parents as the beneficiaries. In the event of your death, the debt is left to the cosigner(s). A life insurance policy can protect your parents from being responsible to pay off what you could not.
Life insurance becomes an important factor when there is someone else relying on you like a spouse or child. This may not be an immediate consideration for all college graduates, but it is something to keep in mind when you start a family. Life insurance for someone in their 20s or 30s is generally an affordable cost that won’t break your budget.
Comparison Shop
Don’t buy the first policy you come across. Be sure to shop around. Talking with an independent agent can be a great first step. An independent agent can shop for the best rates and help identify discounts for which you may be eligible. Also remember that bundling your policies can save you some bucks. Insurers will often give discounts when you have multiple policies with the same company.
Have questions? Contact a Brooks, Todd & McNeil agent. Our independent agents can design a custom coverage program to meet your specific needs and tailor it as your insurance needs change over time.