My children do not have life insurance.here’s why

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Does Child Life Insurance Really Matter?

Key Point

• Life insurance provides important insurance coverage.
• I do not have child life insurance.
• Buying life insurance for children often makes no financial sense.

Life insurance provides very important protection. In my family, both my husband and I have life insurance. However, we do not have life insurance for her two children. Even though they made the mistake of buying substantial amounts of insurance to protect their assets.

The lack of a children’s policy is not an oversight. We deliberately decided not to buy life insurance for our son or daughter. And that’s because we don’t believe that purchasing this type of insurance is a good investment.

Here’s why we think life insurance for children doesn’t make sense

Life insurance for children can be purchased separately from an independent insurance company or in addition to a parent’s policy. Usually either parents or grandparents buy this insurance for their children. This is different from standard insurance purchased by adults. Because adults usually buy insurance for their lives to protect their families.

Usually, when you buy life insurance for your child, it’s whole life insurance that lasts indefinitely. Parents can pay premiums until their children reach the age of majority, at which point they can take over the premiums and maintain the insurance. And like most whole life insurance plans, this policy can act as an investment vehicle to capture cash value. As long as the premium is paid, the coverage will not end.

However, there are some issues that make it not worth purchasing this kind of coverage.

First and foremost, life insurance replaces the income that the deceased person provided and the valuable services that the deceased person provided. For example, a stay-at-home mom who takes care of children.

Our children, as much as we love them, actually bring money into our household or provide services that we have to hire someone to if something happens. In fact they are paying us instead of bringing money. As a result, you don’t have to have coverage available to help you financially should the worst happen.

Today, the idea of ​​buying whole life insurance for children is based on the fact that children can buy whole life insurance at a low cost before they become adults, ideally before they develop pre-existing medical conditions, so children are the insured. But this only works if the policy is in effect for the entire childhood When If you choose to continue whole life insurance as an adult. This is usually not the best bet as term insurance is more affordable and provides all the coverage most people need.

We don’t want to pay decades of premiums for whole life insurance that we don’t have to protect our finances and we don’t want to keep when our sons and daughters grow up, so there’s no reason to do so. Buy life insurance for our children.

Should I get life insurance for my child?

Ultimately, most people may not need to buy life insurance for their children. It’s not necessarily a bad idea to have a small policy to cover funeral costs in the event of a tragedy, but buying a large whole life insurance policy can be costly if you have no income and buy your own at a more affordable price. It makes little sense for those who can.Term insurance then.

Of course, everyone should do what is right for their family situation. But more often than not, some people, like us, find it doesn’t make much financial sense to get life insurance for their children.