New Parents- Why it’s important to insure your children, your parents and yourself

Benefits Life Insurance

By Yolanda Spivey

When my child was first born, I took out life insurance on him immediately. As a person who is well versed in insurance products, I knew that unfortunately, anything tragic could happen at any time. I also couldn’t pass up the $1.00 a week premium that was offered to me for a policy payout of $50,000 on a permanent insurance product. It’s not a lot of money, but more than enough should a tragedy strike.

When personal milestones like the birth of child, occur in your life, it is important to look at your insurance options. It is also important that parents look into buying insurance for their children and themselves to ensure both are protected.

When buying life insurance, new parents should:

  1. Learn about the different insurance options available

Life insurance generally falls under two categories—Term insurance and permanent/Whole Life insurance.

With Term insurance, you pay for a set period of time and your premium remains the same. After the term period is over, you have the option of renewing your policy at a higher premium that will reflect your age and health at the time of renewal.

With permanent or Whole Life Insurance, your premium remains the same for as long as you’re alive. It is important to note that the younger you are, the cheaper your insurance will be.

This is by way no endorsement, but Gerber Life has a great grow up plan where you can insure your child’s life for only a $1.00 a month. This will give you around $10,000 in coverage and the great thing about this plan, is when your child turns 18 or 21, the value of the policy doubles!!!

 

  1. Take out extra insurance on your life.

In my insurance practice, Michael Whitney & Associates, I encourage parents to take out a Whole Life policy on their lives that they will have forever. But I also encourage them to take out Term insurance. It is so inexpensive and you can get well over $100k in insurance for virtually pennies on the dollar depending on your age.

For instance, a 20 year old man who is healthy on average will pay $32 a month for $500,000 in coverage on a 20 year term policy. That is a small amount to pay for the amount of insurance being offered.

The term insurance creates a financial safety net for your family, and will ensure that there is enough money available to pay off medical bills, mortgage payments or future college education costs.

 

  1. Insure the life of your parents.

I cannot stress enough how important it is to take out extra insurance on your parents life. The last thing you want as a new parent yourself is to be financially responsible for a parent/s that wasn’t responsible in securing insurance on his or her own life.

In our community, we are very negligent when it comes to these matters. I cannot tell you how many times the collection plate was passed in my own family to pay for aunt so and so or uncle so and so’s funeral.

There are many insurance companies who offer Final expense insurance that will cover funeral cost for your parent/s. It is also inexpensive and can save you a ton of financial grief should the unexpected occur. You won’t get rich off of this insurance, but you won’t go broke paying out of pocket final expenses.

 

 

 

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