Welcome to adulthood. Where budgeting not only includes making rent each month and late night pizza delivery, but also spending your money wisely in the somewhat confusing areas of investing, purchasing insurance and contributing to your 401(k).
Here at TFAS, we want to help our young (and young at heart) alumni have an easy transition from college life to the “real world.” That’s why we are beginning the new series, “Real Tips for the Real World.”
This month, we’re highlighting something that everyone should have, but might not understand: insurance.
Everyone needs to be insured, but not everyone knows how or where to start. With recent laws and regulations, some may not even know where to begin looking.
Tom Aschoff is the manager of client relations and sales at Meyer & Associates, an affinity group insurance company dedicated to helping organizations find the best plans for its members. M&A is the administrator of the TFAS Alumni Insurance Program. Aschoff helped us understand why insurance is important and what types of coverage working professionals need.
“The bottom line is, once you get out on your own, you need to make sure that the things and people you care about are protected,” Aschoff said.
Aschoff discussed that it is a common for most young people to think that just because they’re “young and healthy,” they don’t need insurance coverage, but unfortunately, they are wrong.
“Insurance by nature is the stuff you purchase that you hope to never use,” Aschoff said. “I think the biggest myth is that young people don’t need some form of coverage for their belongings, or a small amount of life insurance to cover their debt if something should happen to them, or that they don’t really need health insurance, but the fact is, things can happen to anyone. It’s not about how healthy you are, it’s about the world we live in.”
It’s also important to remember that today, not having health insurance is illegal and is punishable by an increasing fine each year.
Young professionals should look into their health insurance plans and make sure they’re getting the best coverage. Many people under 26 years old are able to stay on their parents’ healthcare plan, but they should still make sure that their coverage is the best plan, especially if they are living in different areas of the country than their parents.
“When talking about “building a plan on a budget,” Aschoff reminded us of one area in particular that young people should look into:
“Most people overlook renter’s insurance,” Aschoff said. “If you have an iPad, cell phone, laptop and television, you have in your possession thousands of dollars worth of belongings that no one thinks of in that way. Renter’s insurance is a cost effective way to make sure that, should anything happen, those things are protected.
When it comes to renter’s insurance, many people also do not know that their landlord will not, and legally cannot, help cover the cost of replacing items in the event of a theft, fire or flood disaster. This is because a landlord doesn’t have what’s called an “insurable interest” in a tenant’s personal property.
Renter’s insurance plans are relatively cheap, so look into this form of insurance that can help you in case something happens to your personal belongings. Some plans can even help cover the costs of damages to other’s property, medical expenses and the costs of finding a temporary place to stay.
Whether you’re covered in every area or just starting out and needing an extra push, Aschoff reminded us that everyone should at least begin looking into some sort of insurance coverage.
“It’s really important to just be educated about insurance options,” Aschoff said. “If [my advice] even begins the thought process or conversation of someone making an informed decision, that’s really what we’re after.”
To learn more about TFAS alumni insurance benefits through Meyer & Associates, please visit www.TFAS.org/insurance.