Many young professionals under the age of 35 in South Africa prioritise investment savings over buying insurance, according to recent research by Liberty, a financial services provider in the Standard Bank Group. This leaves them vulnerable to adverse serious life events.
The research shows that:
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Around 90,000 clients under 35 use Liberty’s investment products.
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Another 230,000 clients in this age group use Liberty’s Stash Savings app.
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However, only 6,000 have taken out life insurance, and around 30,000 have some lifestyle protection, such as retrenchment or critical illness cover.
The reasons for these choices include:
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Present Bias: Young professionals often focus on immediate responsibilities, like buying property, paying off debt, or building careers, instead of planning for the long term.
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Perception of Expense: Many believe life insurance is costly and more suitable for families with dependents.
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Feeling Healthy and Invincible: Younger individuals may feel that life insurance is unnecessary due to their current health and is more suited to established families who might have more to lose.