Lesser-known life milestones that could impact insurance rates

When you’re a kid, life is full of thrilling milestones, isn’t it? Before you can actually read, you can get a library card! Five is a whole hand of fingers! Ten is double digits! PG-13 movies and getting your driver’s license follow in short order. But then what? You turn 18 and, sure, you can vote* and get married without special permission in 48 states (Nebraska says 19, Mississippi says 21), but THEN what!? Join us on a journey through a long, fruitful life of lesser-known milestones that can impact how much you pay for insurance. 

21: Party on, Wayne!

We’re assuming you know that turning 21 marks the moment when you can legally drink alcohol. This also, of course, means that you will be drinking said alcohol responsibly. Go have fun, but be smart about it! Twenty-one is also, as of December 2019, the new federal minimum age for purchasing tobacco products. The “T21” bill, which raised that age from 18, is aimed at keeping tobacco use down in the US, since it kills up to 8 million people a year. So if you’re walking that road, maybe go ahead and look into some life insurance so your family can cover your untimely demise. Sorry to be a bummer!

25: A quarter of a century man!

Is this the part where we talk about John Mayer coining the term “quarter-life crisis” and making millions of millennials face an existential crisis? Well, good news: You can rent a car now to drive those worries away. This conventional wisdom is actually misleading: You can rent a car with a valid license when you are under 25, but you have to pay a “young renter fee,” which starts at around $20 a day and goes up depending on the type of rental. You can avoid the fee from some rental companies by having a AAA membership or renting through your employer.

26: Your first very boring birthday in a long line of very boring birthdays

So yeah, last year you were 25, which is a big, round, cool number. This year you are 26, and being 26 is a lot like being 27 or 28 or 33 or 37 or you get it, right? We promise life isn’t just full of bummers, but 26 is the age when you get booted from your parents’ health insurance as a dependent. Sorry! You gotta go get your own now, either through your employer or through Healthcare.gov. Anyway, there is a great flipside to this milestone, which you will encounter as you grow older/read on.

30: Neither the new 20 nor the new 40

Sure, people already toast to 30 – a new decade, a new sense of maturity, a final departure from numerical youth, all worth a party and a subscribe-and-save order of Metamucil. But did you know that recent research suggests that turning 30 is more than just symbolic for your brain? It turns out that your brain continues to develop through your twenties, and when you reach 30, you have actually become the person, more or less, you’re gonna be. And though technically you’re an “adult” much earlier in your life, car insurance companies have known about the magic of 30 for a long time – the average insurance premium drops significantly from ages 29 to 30.

50: Rhymes with nifty, thrifty and … shifty?

Half a century! Two quarters! A half dollar! There’s a lot to celebrate when you’ve made it to the big 5-0, but we don’t want you to miss a few little things: turns out the auto insurance industry thinks forty-somethings are only slightly more responsible than thirty-somethings, because the savings don’t change much between those decades. But when you hit 50, you enter the lowest average car insurance premium bracket (see above re: Thrifty)! Car insurance premiums are all uphill from 60, so enjoy this most affordable decade. You may also associate turning 50 with joining AARP, but joke’s on you – you can actually join AARP and enjoy their sweet, sweet discounts at any age. Of course, some of the discounts, particularly on insurance or health products, are only valid for individuals over 50, but not all of them!

53/57: It’s an average; keep reading

Truly, you can find some minimilestones to celebrate at any age, and we thought we’d put a little shine on your mid-50s with this tidbit: In 2018, the average ages that women and men became parents were 27 and 31, respectively. So if you had a kid when you were those ages, 53 or 57 is the age you’ll be when your kid is no longer covered by your insurance – it’s the flip side of 26! Here’s to no longer paying for dependent coverage. Get yourself something nice, like some slacks from Chico’s or customized golf tees. Really lean into your mid-fifties!

59.5: Tell your toddlers half-birthdays always count

Oh did you think you were finished acknowledging half birthdays sometime in elementary school? You’re not! You might get a special half-birthday present at 59.5, if you planned ahead. By the time you are 59.5 years old, filling out those 401(k) forms in your twenties probably feels like a sepia-toned memory. But 59.5 is the moment you and that paperwork have been waiting for, because now you can finally withdraw funds from 401(k)s, IRAs, and other retirement accounts without incurring any tax penalties. Go get your money!

 

65: When you’re 64 + 1

“Will you still need me? Will you still feed me? When I’m 64?” We hope so, because in an effort to get you to the benefits of being 65, you’re gonna have to make it past 64. Are you retired? Or mostly retired? Good for you, because it turns out you can stop filing income taxes if you’re over 65 and you make less than $13,850 as an unmarried person or $27,000 as a married couple. And that doesn’t include Social Security benefits, which some people may be collecting by age 65 (see below). And in some states, you can even stop paying property taxes!

67: The moment you’ve been waiting for since your very first paycheck

Remember when you were a teenager, and you were so excited to get your first paycheck, and then you were so annoyed to see how little of it you actually got to keep? Well to paraphrase Phil Collins, you’ve been waiting for this moment for all of your working life. Assuming you were born after January 1, 1960, 67 is the age at which you can finally begin collecting the Social Security benefits you’ve been paying into your entire career. Fingers crossed it still exists when you get there and those pennies you put away in your high school soft serve job haven’t vanished!

72: Four short the right number of trombones

This is our final milestone year, but it doesn’t mean you’re done celebrating. By now you may have grandkids or an extremely fulfilling life without them! You’ve got your retirement incomes flowing, and life is good. It’s time to celebrate every year! But first: If you turn 70.5 in 2020 or later, 72 is the age at which you must begin withdrawing from those retirement accounts you were eligible to draw from all those 12.5 years ago. If you’ve been incubating that nest egg, your time is up! These withdrawals are called Required Minimum Distributions (RMDs), and our pals at the IRS have many handy tools that can help you calculate what your RMDs will or would be.

Look, we’re not gonna pretend that getting older necessarily carries the same kind of excitement that 18 or 21 or even 25 does. But hopefully, we’ve given you a few more things to look forward to as your long and wonderful life spools out. And it’s not all insurance premiums going down with age (to a point). It’s anniversaries, births, food and coffee. There’s a lot to look forward to, you’ve just gotta look.

*FYI, you can register to vote when you are 17 if you will turn 18 by or on Election Day! Tell all 17-year-olds in your life!