People with young children or large mortgage loans are often advised to invest in life insurance – and here’s why. Life insurance will prevent survivors from suffering a financial bind.
But as children get older, the responsibility to purchase a life insurance policy falls on them. But what happens when these individuals choose to forgo life insurance?
A recent column by the Christian Science Monitor offers advice for parents who find themselves in this situation.
One reader considered buying a policy that would cover her son. Despite having a family of seven, the son refused to buy a life insurance policy to ensure their finances. In the event of his death, such financial responsibility would fall to his parents, according to the report. The reader may be able to purchase coverage for her son, the report says.
“If he’s not going to do it, you absolutely can take out a life insurance policy on him with you as the beneficiary,” the report says. “This is to protect yourself in that situation.”
But before you take out a policy, you’ll need to have a long conversation about your plans with your adult children. You should focus the conversation on the importance of life insurance and the options that it can provide.
Many times it’s a lack of knowledge, not money, that holds people back from the purchase. And it’s particularly the case among young people who feel invincible. If the son or daughter is healthy, all the more reason to purchase a policy before an accident occurs or medical conditions change.
If making ends meet is difficult – and parents are willing to help – a conversation with a financial planner will help reveal the best available options.
A term-life policy may be the best choice for parents in this situation because it offers an affordable way to accumulate savings without any of the complications of an investment package. A term-life may also offer college tuition opportunities as well.