When speaking with my clients, there really isn’t a more emotionally charged topic than kids and life insurance. There seems to be a great divide on feelings and temperment when I bring this topic up. Many people are grateful for the opportunity to dicuss this – and some are even more grateful that I’m the one bringing it up so they don’t have to. Others will move awkwardly in their seats and ask to bypass the topic. No matter your thoughts, I am fully committed to explaining why you should take the time to consider purchasing life insurance on your kids. After all, they don’t have the ability to make this decision for themselves and are relying solely on you as their guardian to protect their future.
- Protecting long term insurability – What does this really mean? Let’s look at the way in which people purchase life insurance. When you are a typical 30 or 40 year old, the process involves taking a quick medical exam and having an insurance company review your medical records to be sure you are an overall healthy person. What if you’re not? What if you are one of the people in this world who have had a negative health experience in your early life? It’s more common now than ever before to have young people experience health problems. If you have done your due diligence in purchasing life insurance for your kids – they will have something to keep them protected no matter what future medical concerns they may face. Once life insurance is in force no one can take that away from you (assuming the premiums continue to be paid, and the policy is in good standing, of course.)
- Protecting their future family – It may seem weird and a LONG WAY OFF, but someday your little babies will grow up to have spouses and families of their own. I have a 9 month old and people keep telling me this will happen sooner than I can even imagine! It is a special thing to turn over a paid life insurance policy to your kids as they grow into this new stage of their life. At some point, your adult child may decide to build on that original plan and add to it. Good for them if they do! However, if not, you have still protected them and their future family by your decision many years before. You should feel proud about that.
- Giving them an investment alternative – Most life policies that are available for children also carry a cash value component. This means for every year you pay your premiums on the policy itself, a savings account is essentially building up inside of that policy. As your child gets older, the cash amount grows and grows. Someday – if they decide they don’t need the life insurance value anymore, they can take the cash value and go on their way. Thanks mom and dad!
- It’s never more affordable – Traditionally: the younger you are, the healthier you are. These two components are the perfect combination when talking about life insurance. This makes kids life insurance the most affordable way to purchase it. Today – the present time – is the most affordable that life insurance will ever be for your little loved one. This makes the financial decision easier.
- College savings – Oh and one more thing, college? Yeah, that’s getting more expensive each year. I shudder to think what the cost will be by the time my infant is ready to go. But wait! What about the cash value accumulated in that life insurance plan? Many kid’s life insurance plans are designed with just that very thing in mind. They are designed to be a saving vehicle for future college and education needs. Set the bar high right from the beginning!
There are many reasons why you should NOT shy away from the topic of life insurance on your kids. Even though we don’t like to think about it, kids are not kids forever. I made this personal decision for my child and have not regretted it for one day.
Your trusted personal insurance advisor is the best person to have a discussion with. If you are looking for advice and don’t already work with someone, give me a call.
Until next time, appreciate and enjoy your family!