Guest Post from Smart Parent Advice
5 Reasons New Parents Should Consider Life Insurance for Kids
If you are looking for information on Life Insurance for Kids, you are not alone. It’s one of those things that all parents should consider.
Life insurance is something that you hope to never use, but it’s a smart financial investment in case the unthinkable occurs. You probably have life insurance for yourself or your partner. It provides a layer of financial security in the event that one of you dies.
But did you know life insurance for children also provides that security? Your policy can help cover funeral costs and other expenses, which offset the financial burden during unfathomable circumstances.
Check out these 5 reasons you should consider getting life insurance for your child today.
5 Reasons You Should Buy Life Insurance for Your Kids Today
1. Life Insurance for Kids Encourages Savings
New parents quickly take not of the expenses that come with a baby. You might be so focused on those day-to-day costs, such as diapers, childcare, carseats, and strollers that you might not even think about long-term expenses like educational costs…
…and perhaps you don’t have the extra money month to month to set aside savings for college.
An insurance policy for kids serves as a savings vehicle for your child. A permanent life insurance policy provides coverage through childhood and has cash value.
As the parent, you are the policy holder until your child reaches adulthood, usually between ages 18 – 21 depending on the policy. Over that time, you pay monthly premiums into the account, and it grows with interest.
The odds are in your favour that you will never have to use your life insurance policy for its intended purpose. However, that money is not lost because permanent policies guarantee a payout as long as you keep up with your premiums.
When your child reaches adulthood, the funds can be withdrawn and applied toward financial needs such as educational expenses. Your policy actually serves as a savings fund for your youngster’s future!
2. Gives Your Child the Chance to Get More Insurance
Securing the best insurance for your child now sets them up for acquiring more life insurance when they get older. The permanent life insurance policy you select for your infant can, if they choose, be a policy that they carry with them into adulthood.
There’s no expiration date on these policies, so as long as you or your child continues to pay the premium, the policy will stay in effect.
Securing life insurance when you’re older can be a challenge, especially if you have preexisting health conditions. If your child develops a medical issues they may have trouble securing reliable life insurance, or the premiums may much higher because of these health concerns.
By locking in health insurance now, you protect your child by giving them access to life insurance for as long as they need it.
“Mental health” for most insurers will include all aspects such as stress, post-natal depression, ADHD, eating disorders, addictions, persistent tiredness, ME, fatigue, as well as the more obvious depression and anxiety. Clients will typically be asked for the diagnosis, symptoms and treatment. Some insurers want clients to disclose all mental health episodes regardless of when they occurred.
3. Life Insurance for Kids Helps With Funeral Expenses
In the event of your child’s death, your life insurance policy can help you pay funeral expenses and more.
Funeral costs can be overwhelming during an already challenging time. The cost of a casket alone starts at $2,000 and may reach higher. Fees from your funeral home, along with burial or cremation costs, can push funeral expenses closer to five figures.
If your child’s passing is triggered by a health problem or accident, you are probably facing significant medical bills as well. Combined with funeral costs, these expenses can be overwhelming and perhaps even impossible to pay off for many families. The best insurance policy for kids can help you cover these costs.
Most children’s life insurance policies cover funeral expenses, which can offer some financial security during your time of grief. Some policies also help cover other expenses, such as medical bills, which may minimize the financial impact of your child’s death, providing some peace of mind during an overwhelming time.
4. It’s Easy to Secure
Often, the process of obtaining life insurance alone might be a deterrent to getting it. Fortunately, securing life insurance for kids doesn’t have to be a challenging task.
Many kid-focused life insurance products are out there and you can choose from term or permanent plans. A term plan has an end date–often your child’s 18th birthday–while a permanent plan can last into adulthood, provided your child continues to pay the premium.
Perhaps the easiest way to secure life insurance for your child is to add the protection as a rider to your life insurance.
This process is simple because you already have a policy set up. Which means the child rider allows your policy to grow with your family. You can add a rider for a set amount–for example, $20,000–for each child.
5. Life Insurance for Kids is Cheaper Now
Life insurance policies increase in cost as you age. After all, your risk of death increases with every year of life, too. So, a life insurance company is going to charge more for a policy on a 15-year-old who is about to start driving than a 15-month-old.
If your child secures a policy in early adulthood, it’s going to come with an increased price tag.
Securing life insurance for your child when they are young means lower premiums. This is because young children are in a low-risk bracket. Remember life insurance is a smart investment in your youngster’s future.
Buying a Life Insurance Policy for Kids Is A Good Idea & This is Why!
Don’t overlook a life insurance policy for your child. You spend plenty of money investing in their health and safety – searching for the safest co-sleeper crib to reduce their risk of sudden infant death syndrome – taking them to the pediatrician for regular appoints. Why skimp now?
That’s why it makes perfect sense to consider locking in your child life insurance policy now, to protect them AND your family in the future.
Author Bio: Cristin Howard runs Smart Parent Advice, a site that provides parenting advice for moms and dads. Cristin writes about all of the different ups and downs of parenting, provides solutions to common challenges, and reviews products that parents need to purchase for babies and toddlers.