Prestizia Insurance Blog
A baby changes the perspective of new parents. The baby has a lot of needs and you want to give your child everything that you can. Is life insurance part of your plan? Buying a coverage is one of the best things that you could give to your family, especially in the financial aspect.
Why Choose Life Insurance?
When the policyholder of life insurance dies, the insurer gives the payout (death benefit) to the beneficiary, such as a spouse. So, if you buy life insurance and you die, your spouse receives the amount of the death benefit. Even if you are not around, you continue to support your family with the payout. The money can be used for your child’s education or for paying the mortgage.
Permanent Life and Term Life
These are the two common types of life insurance. Permanent life gives payout regardless if you die in the following year or 40 years after. There are some policies under permanent life insurance; indexed universal life, variable universal life, universal life, and whole life. These policies may include a cash value, which is a long-term investment that gradually increases.
If your child has special needs, permanent life is a good choice, as it can be a lifelong financial support. If you have an estate, permanent is also beneficial, as your beneficiary can use the payout for the federal estate taxes.
When it comes to term life, it is the most affordable option. You can purchase several policies with certain time period in low prices. The insurer pays your beneficiary if you die within the term. You can buy coverage that can help you build enough savings. With that, you can pay your debts, mortgage, and your child’s education. In the end, you will leave your spouse with enough savings for retirement.
Name Your Beneficiaries
Even if you love your children and want them as your beneficiaries, do not name them if they are young. A minor beneficiary will not receive the payout when you die; they will have to wait for the court to appoint a guardian. So, the best choice for your beneficiary is your spouse.
However, you may create a life insurance trust and name the trust as your beneficiary. The trust will keep the property and money for your children until they become adult themselves. An adult person or your spouse can be your trustee, whom will follow the trust as per your instructions.
Being a new parent entails many responsibilities. With life insurance, you can take care of your children in the event of your death. The insurance company can help you choose the life insurance to buy and name your beneficiaries. At Prestizia Insurance Group, we take pride in making sure that our clients are well-protected at prices they can afford. To learn more about how we can help you, please contact our agency at (855) 436-6353 or Click Here to request a free quote.