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Life Insurance for Children: A Difficult but Needed Discussion

 

Do I need to purchase life insurance for my child?  This is a question many people ask quietly to themselves as they are often uncomfortable talking about aloud.  It’s a conversation all parents need to have; with one another, with family members and with a trusted resource like a financial advisor.

So let’s address this difficult topic.  Our short answer is yes and there are several reasons why.

Many people think life insurance is twofold: to cover funeral expenses and to replace the lost income or future earning of the person insured.  They would be correct in that thinking but it can be so much more too.

Are you covered?   

First and foremost, you need to be sure the adults in the family are covered by life insurance.  If you are the main income earner you need to be sure your surviving family has the funds to cover your burial, meet outstanding debts such as your mortgage and have a replacement for the income you would have earned in future years that would have been used for every day expenses and for future needs such a college .  If you aren’t the main income earner you still need to be covered so expenses such as childcare can still be covered.

For children there isn’t any income to replace.  And maybe you don’t need funds to cover funeral expenses.  So why is it important?

Future Insurability:

By purchasing life insurance, you can lock in affordable premiums for the long-term.  Rates are often very affordable for children.  You will also protect your child’s future insurability should something happen to them in the future.

Some life insurance policies are can also serve as a long-term investment for savings for your child’s future expenses such as college.

Time to grieve?

Perhaps one of the least discussed reasons is that life insurance can give you the time and funds needed to grieve.  The loss of a child is probably the worst thing a parent, or anyone, can imagine.  Having life insurance can give you the ability to take the time to step away from work and other obligations to handle your grief without worrying about how your bills will be paid.

There are many options to consider when buying life insurance.  Talk to a trusted advisor today.  We’re always here to help.

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