Life insurance are meant to protect the families of the dearly departed. But according to a recent report, rising costs are forcing people to tap into their policies just to live.
Yahoo reported that data from Massachusetts Mutual Life Insurance Co. showed a 31% year-over-year increase in the third quarter of Americans taking making early withdrawals topping out at almost $700 million.
“In this inflationary time, people are tapping into their permanent life insurance policy’s cash value,” Paul LaPiana, head of product at MassMutual, in a Yahoo Money. “At the same time, we are not seeing any upticks in policy surrenders, signaling that people value the coverage that their life insurance policy provides.”
This influx of loans taken out against life insurance policies comes at a time when inflated living costs are at an all-time high.
As previously reported by ESSENCE, inflation has forced a large number of Americans to get second jobs. According to a survey by Qualtrics, 38% out of 1000 surveyed workers said they have started looking for a second job, while another 14% are going to start soon.
“With budgets tightening, workers are searching for ways to meet the rising cost of living, including finding new jobs,” said Qualtrics Chief Workplace Psychologist Dr. Benjamin Granger as reported by ABC News.
ESSENCE also previously reported that parents are particularly strapped as almost 70% said their wages aren’t cutting according to the poll. Nearly 47% of workers with kids are actively seeking part time work in addition to the jobs they already have. This makes sense since childcare costs are continuing to rise. The Brookings Institute has reported that raising children up through high school costs $300,000, which is $26,000 from two years ago.
The latest data from the Bureau of Labor Statistics (BLS) reflect that energy prices are up 19.8% and gas alone has jumped 18.2% over the last year. Used car prices are up nearly 7.2% for the year, and new vehicle prices are up 9.4%