If you want to ease your financial responsibility of raising a child, you should consider getting life insurance. Life insurance and raising a family go hand in hand, but many parents don't usually think of life insurance as a viable solution. However, once you understand the benefits of life insurance, you cannot avoid it because it's a good choice to build financial stability for your child. Here’s how life insurance and other ways help you stabilize your child’s financial future.
A benefit of a life insurance policy is that it pays your loved ones upon your death. When you apply for a life insurance policy, you should be thinking about the type of plan that works best for your budget.
The two main types of life insurance plans are term life insurance and permanent/whole life insurance. While term life insurance is cheaper and covers a specific period, permanent life insurance costs more but covers the insured for their lifetime, providing more benefits, such as cash value and fixed premiums.
Many employers provide parent-friendly programs that include group life insurance plans. Ask your employer if any such programs are available to you. Key benefits to look for include paid leave and pre-tax child-care flex accounts. These benefits can help you save thousands of dollars annually.
The easiest way to provide healthcare benefits to your child is by adding their name to your existing insurance policy. Talk with your HR officer and your current insurer to discuss insurance options for your child. Make these calls within 30 days of your child's birth.
Additionally, you can provide future benefits for your children by establishing a will. Without a will, it may be up to the state to determine how your assets are allocated when you die. A will offers better clarity on what’s allotted to your child upon your death.
The best plan for efficiently managing expenses is to create a simple budget and stick with it. At the start of every month, determine your monthly expenses and look for ways to cut unnecessary expenses. The rising cost of living has forced many families to tighten their budgets. Developing a cost-cutting plan might include conserving energy, driving less, and reducing entertainment expenses.
Maintaining a sensible budget will keep you from sliding into debt or winding up cashless at the end of the month. While it's fine to use credit cards for things that aren't immediately affordable, you also need a plan to pay back credit card debt so that it doesn't escalate out of control.
Are you expecting or planning for a child? You can take control of your family’s financial future today with a personalized life insurance policy. Contact our insurance experts at C.V. Mason Insurance Agency today to get a life insurance quote.