Have you ever thought about getting life insurance for your child? If so there are a few things that you should consider before you do.
This can be an easy way to set some money away for a child's future you need to make sure that you are buying the right kind of insurance so they can put it to use as they get older.
If you buy the right kind of insurance policy the cash value can increase over the years, free from any taxes, and would be able to use it later in life for major purchases or even as a way to pay for further education such as collage.
While there are many differences in life insurance, I'm only going to talk about the differences in two of them.
Short term insurance does not guarantee that the child will be insured in the future, thus for this type of insurance expires usually when the child turns 18 or 21.
Therefore you have nothing to show for all of the money that you paid out of pocket, this type of insurance is good for burial expenses, and help cover the cost of work if the child dies.
Also short term life insurance also means that you can't get a loan against it, or cash the money out if you ever need it, since the cost of this insurance it may be a good investment, this type of insurance is usually cheaper.
Are there any health problems that may prevent the child from being able to get life insurance when they reach adult age, if so this would be an opportunistic way to guarantee that the child we be covered in the event of death.
Whole life insurance will grow as the child grows into adulthood, he/ she may be able to draw the money out, or even may be able to use it for such things as collage, trade school or start working.
With this type of insurance when they get married there is already a small amount of protection set up for the new wife and family.
Most insurance companies will also be happy to add other life insurance policies to the existing ones.