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18 Jun 2024

Invest in yourself now – because “later” is not a risk worth taking

Sinenhlanhla Sithomo

Sinenhlanhla Sithomo | Head of Insurance Business at Investec Life

In your twenties, it’s tempting to think of life insurance as something you defer to “later” – a day in the future when you aren’t paying off your car or saving for a deposit on your first home. But the truth is that more people probably depend on your income-earning potential right now than you realise. And when something is that important, you protect it.


There’s a long-held truth in life insurance that one person is never just one person. That’s because our ability to earn an income isn’t only a source of self-support but becomes a source of indirect and direct provision for others.

Indirectly, our income sustains others every time we buy groceries, dine out or employ someone. In each of these moments we’re supporting the livelihood of others – people who depend on our income to earn their own.

Directly, our income provides for our family. Most primary income-earners don’t only support their spouse and children, they also supplement their parents’ retirement savings and help siblings, in-laws, and staff as the need arises. This “family” is broader than blood relatives – they’re more like a network of human connections we feel responsible for. If anyone in our network is in trouble, we step in to help.

Your 20s are arguably the most important time to ensure you are financially protected against illness and disability.

The accretive cost of success means that as wealth grows, provision grows too. And even though this heightens pressure on primary earners, most people consider it a privilege to support those who supported them. For those with significant income potential the question is not whether you can afford life insurance, but whether your dependents can afford for you not to have it.

This is not something you do “later”. Your 20s are arguably the most important time to ensure you are financially protected against illness and disability. If you’re unable to earn an income from your 20s onwards, there’s at least 40 years of lost earnings potential not just for you, but for everyone who depends on you. Most of us erroneously think that life insurance is only about death benefits. But in a world where you are eight times more likely to suffer from a temporary disability than die, it is critical to have living benefits like income, illness and disability cover, to get you through the financial impact of an illness. In our research, 162 people were supported by just 42 salaries, making the impact of a permanent life event even more devasting.

When you have to self-fund your treatment, you destroy wealth; but when you plan for it appropriately – with appropriate cover – you’re free to focus on what’s most important: recovery.

In this way, life insurance cannot be separated from any good wealth building strategy.  Especially at a younger age when capital accumulation has only just begun, the benefits of planning for an uncertain future far outweigh the marginal costs of a monthly premium. And when you’re younger, they are marginal compared to other financial commitments. Investments and insurance will always reinforce each other because getting sick costs money and can deplete years of savings. Most people learn firsthand that medical aids and even supplementary gap cover may not cover all costs associated with getting a severe illness. The shortfalls are generally on unpaid time off work beyond mandatory sick leave, and latest or advanced treatments that aren’t part of prescribed minimum benefits. When you have to self-fund your treatment, you destroy wealth; but when you plan for it appropriately – with appropriate cover – you’re free to focus on what’s most important: recovery.

Fundamentally, we must all reckon with the truth that our lives have value. Not just in an intrinsic human sense – the way all lives have inherent value – but extrinsically our lives have financial value that can be measured, underwritten and paid out. This can feel transactional, but it is really just practical, because through life insurance we can pay forward every good thing that has been entrusted to us, giving us an opportunity to invest in ourselves, others, and the future we hope for.

  • Disclaimer

    Investec Life Limited, a member of the Investec Group, is a licensed Life Insurance Company (Reg. No.1944/017130/06) and an authorised Financial Services Provider (FSP number 47702). Terms and Conditions apply. This article contains factual information and should therefore not be regarded as financial advice. For more information or advice, contact Investec Life on +27 11 291 3934.

    Focus and its related content is for informational purposes only. The opinions featured on the site are not to be considered as the opinions of Investec and do not constitute financial or other advice. The information presented is subject to completion, revision, verification and amendment.

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