Life Insurance for Single Parents
Life insurance for single parents is essential in protecting your family’s future. If you are a single parent and researching this topic, you know the pressure placed on a single parent, you live it. Although rewarding the responsibilities of working, raising children, and paying bills can be exhausting, especially when the other parent is providing limited or no financial support for the family. It is expensive to raise a child, let alone plan for future their educational costs.
We want what is best for our children. That responsibility is ours to pave the way for their future success. We want our children to have the same opportunities they would have if we were still alive and supporting them. We can outlive our life through our children. It is a “Legacy of Love.”
Life insurance can play a valuable role in protecting their future. The average cost to raise a child with a middle-class upbringing is around $250,000, not counting college costs. Life insurance can pay for future educational costs if they decide to pursue college or a trade school. It provides financial support in case something unfortunate happens, and you cannot see your children mature into adults.
Stretching Limited Financial Resources
Typically, single parents financially do not have money to waste due to more significant budget constraints. It is possible to keep life insurance costs to an absolute minimum. It is a misconception that life insurance is expensive. Life insurance for single parents is not costly. The best type of life insurance to choose from with the most coverage at the lowest cost is a term policy. Whole life insurance is more expensive, and policy riders that increase costs like the income replacement, waiver of premium, accidental death, and critical illness riders add cost.
With a term policy, you are paying for “pure protection,” just a death benefit. A term policy is very affordable, especially if you have good health and do not smoke. With this type of policy, you can purchase a significant death benefit that will protect your loved ones. These coverage periods are 10, 15, 20, 25, and 30 years. In determining the term period, consider when your children are heading off to college and on their own.
If you have a young child in the house, a 20-year plan would be a good option. Even though the 20-year policy expires in 20 years, your children should be fully grown and on their own by then. Plus, most term policies can be converted and
The Mistake of Trusting Group Life Insurance Through Your Employer
Group Life is Never Solely Recommended. Unlike other valuable employee benefits, defective group life is in a substandard high-risk pool and always overpriced by about 200%. Compare the charges that quickly increase with age and avoid paying for this extremely high-cost coverage. (Group Life always seems cheap, but the premium charged 26 times a year increases rapidly with each 5-year age bracket.
The premium and coverage are not guaranteed. With a certificate, you rent, it is not a contract you own, it is not portable so you can lose it when you retire or when your employment ends. Also, it is merely may not be enough coverage. If you have a group term at work, we recommended that you always have your life insurance policy separate from the group term insurance. How much should you buy? The starting amount recommended is ten to twelve times your annual income.
Beneficiaries, Guardians, and Trustees
Another thing to consider is selecting the beneficiaries. Beneficiaries receive the benefits of life insurance if there is a claim. You not limited to just one beneficiary. In the case of underage children, the insurance company cannot hand over the insurance proceeds to them. You will need to set up a trustee. This person will be responsible for the funds until the children are adults. It is advisable to set up a trust for children.
You could also need to designate a guardian who would be looking after your children upon your passing. You can decide if the guardian controls the insurance benefits or does not control the funds. Make sure that the guardian understands the legal and financial realities of that responsibility. It is recommended you contact a lawyer.
Why Using Independent Agent is Important
It is essential to use an experienced independent agent as opposed to a “captive” agent. Captive agents can over you a limited amount of life insurance carriers. And they are usually more expensive. As independent agents, we have extensive knowledge of the insurance industry and how to qualify you for the best possible life insurance rates with no medical exam. Many of the websites offering life insurance are call centers with cubicles of agents using a script to sell you life insurance. Some of the sites sell your information to 10 or more agents, which results in you receiving many unending calls and unwanted calls. We are not a call center.
Our staff has extensive knowledge of the insurance industry. We are independent and know the companies, the products they offer. We use the latest technology to improve your experience and get your policy issued as fast as possible at the least expensive rate. Some of the top-rated companies we work with are Banner Legal and General, Mutual of Omaha, Transamerica, SBLI, Protective Life, Assurity, American General, and Prudential, to name a few. We are not obligated to use any specific company. Finding the company that is the right fit for your situation, at the lowest possible price is our goal.