Life Insurance For Children Should You Buy It?

Don't feel guilty. It's okay not to buy life insurance for your children. They won't need it for another decade or more. However, you can always start a college fund for each of your children starting now.

Do you have life insurance? Does the policy have cash value in it? If so, you can save hundreds to thousands of dollars per year for yourself and your family, by changing your policy from life insurance policy with cash value, to term life insurance, pure and simple, and then invest the difference of insurance cost you would save by doing that into a college fund or retirement fund.

This is called "Buy Term Invest The Difference", a lot of credible financial experts, such as Dave Ramsey and Suze Orman recommended it.

The best way to buy Term life insurance is to buy it on the Internet. You will get the most cost effective insurance policy by buying it direct from the providers. By skipping the agent, you save the commission fee, which is usually hidden within the policy so that most clients don't notice it.

Get your term insurance quotes now! As a former agent, I always see how easily a prospective client could have saved hundreds or thousands dollars of insurance cost if he or she simply switches to a term life insurance policy. 90% of the times the clients would be able to fulfill the requirement of insurability, claim back the cash value from the old policy, and save money immediately and for the next 20 to 30 years.

Comparing dollar to dollar, a dollar invested in the strategy of "Buy Term Invest The Difference" is several times more cost effective than in life insurance with cash value.The reason why most insurance agents recommend the more expensive insurance with cash value is because they will earn lucrative commission fee from it, and since such policies are permanent, they will earn a lifelong passive income from your insurance payment for as long as you live.

Why Do They Want To Sell Insurance To Your Children?

They will get lifelong recurring commission fee. They claim that your children will lock in for a cheaper rate since they are so young, but it's still a waste of money, a lot of money, because children don't need life insurance. No matter how cheap things are, if you don't need them then they are too expensive.

Life insurance is for income protection. Bread winners need life insurance because they have to protect their loved ones in case they die and their incomes are lost. For a young family, children still have about 20 years before they can move out and support themselves, and there are other financial obligation such as mortgage. If a working adult suddenly die, the bereaved spouse will not be able to pay the mortgage and other debts alone. This is why adults need life insurance.

Before I became a life insurance myself, I had a universal life insurance policy that my mom bought for me. It cost $70 per month. I cut it after comparing it with the cost of term life insurance and figured I could save a lot of money if I started saving then.

Questions?

What about the tax advantages of life insurance? I remembered the agent showed me the policy will grow into a large amount of money after X years? My children will get that money if anything happen to them right?

Those are the arguments that agents commonly use, and you will find out the answers to those question in the section below.