Life Insurance For Children

Life insurance for children is a necessity for life because it makes sure your children are protected from harmful events in the future. However, financial advisers are heavily divided in terms of whether or not this could be the best option for you to go along with.

To some advisers, life insurance is a great and cost effective method to secure some money for the future and to ensure that a child will have insurance in the event one’s parents die or are unable to work for some reason. Others say that it’s an outdated scheme that has been replaced by more effective savings options like 529 plans. Others say that it is completely foul to sell insurance to a child.

Get life insurance for children

Insurance for children

The American Council of Life Insurers tells us that people do not prefer to purchase life insurance for their children. The study says that only about 15 percent of kids who are less than 18 years of age have whole life insurance and the numbers haven’t really changed in recent time. The average amount of coverage for children is around $5,000, a total which is pretty small. Many companies will aim on a lesser amount of insurance to a guardian’s policy to cover burial costs.

But, it’s still a frequently asked question and most of the parents are often confused with taking a decision.

Some people have gotten whole-life insurance policies for their children alongside mutual funds and 529 plans. They do this together to make sure one’s children will always have some money to use in the event of any serious crises over time.

Many forms of insurance can be used by children but there are disputes over which options should be utilized.

John Sestina, the author of Managing to be Wealthy and a fee-only certified financial planner from Columbus, said that the only type of insurance he’d prefer to order for children is term life insurance. Sestina finds other investments like Roth IRAs as being more beneficial when it comes to reaping wealth for kids.

Against all the odds, parents feel there are many reasons why one should buy insurance policies for their children. Here are few of the most important ones:

  • You get peace of mind: Every parent wants to give the best to their children. A life insurance policy will certainly be useful and protective if something that you had never expected happens to your child. The policy can take care of the expenses that come with a funeral which could cost you thousands otherwise. It’s easier to have peace of mind when you insure your child’s life. A life insurance policy ranging from $10,000 to $20,000 would be more than enough to cover all the costs.
  • The policy can built a cash value: If you have children, whole life insurance is the best thing you can do for them as it can help you develop some kind of cash value over what’s open. By the time your child turns 18, the cash value will be built up into enough to where you can buy something like a car or even pay for one’s college charges. If you’re choosing a whole life insurance policy for your child, ask if there are any penalty charges for an early withdrawal that takes place before a particular age.
  • Small policies are affordable: You don’t need to get a million dollar policy when finding life insurance for children. An amount ranging between $5000 and $15,000 should be a good amount to start with. This is helpful because with such less policy amounts, the costs are comparably inexpensive. You can find these policies ranging between $5 and $15 a month.
  • They’ll always be insured: One of the major benefits of having a life insurance policy for children is that they will always be under cover regardless of their future health conditions. There are many factors that can influence your child’s future insurability like diabetes, cancer, obesity, and high blood pressure. By buying a child policy, you guarantee that your child will always be under cover even in one’s senior years.