If you are just beginning to raise a young family, this is a good time to evaluate your insurance needs. Any insurance planning you can accomplish now, while parents and kids are both relatively young, will probably save you time and money later on.
Life Insurance For Young Parents â€“ Most of the time insurance agents advise young parents, who are just starting to raise kids and pay off a mortgage, to buy term life insurance.
Term rates will be fairly cheap if the parents are in reasonable health, and a term policy can provide decades of protection for the people who depend on you. Because you can usually find cheap term life insurance, you will be able to afford a policy that is large enough to cover your home and other family needs, if your pass away unexpectedly. The other argument for a term policy is that, with proper financial planning, the younger family will save enough money to be self-insured by the time they are older and the term of the policy expires in 20 or 30 years.
However, I would also advise younger parents to consider adding in a smaller face value permanent life insurance policy. I have seen two many situations where people’s financial plans did not work out exactly the way they expected, and they still needed coverage when they hit middle age or retirement years. It will be much cheaper to buy whole or universal life at a young age, and then you will have the security of knowing you will have some coverage when you are older.
Some younger parents do not consider buying their own policy because they are covered at work but people change jobs or start their own businesses and lose group coverage all the time. Buying your own policy, that will follow you through the course of your life no matter where you work, can be an affordable and wise decisions.
Life Insurance For Children â€“ This is really cheap, and it is a lifetime gift. In many cases, if you cover your children now, the insurer will allow them to convert it to their own policy when they are adults without having to show any evidence of insurability. In addition, cash value policies can accumulate value so they can be used as assets when the children are older, even if they do not need the coverage.
Health Insurance â€“ If one of the parents has group coverage at work, make sure you let your group plan know about any births. Most of the time, newborns will be covered right away by their parent’s policy. If you do not have access to group health, children are usually fairly cheap to insure. If you cannot afford or access an individual health insurance plan, look into CHIP (Children’s Health Insurance Plan) plan for inexpensive children’s health insurance.
Even if your children are healthy, please do everything you can to get them covered. I just had to visit an emergency room with my own son who broke his arm roller skating. It was a simple fracture, but the bill for an hour spent getting an X-Ray, and then having his arm bandaged and put in a sling would have been over $2,200! That does not include a follow up visit at an orthopedist’s office where he got a cast. Lucky for me, he was covered, and I only had to pay a $100 copay. Without insurance, that would have been a very expensive day at the roller rink. Even if you have active and healthy kids, they are bound to have accidents.
Disability Insurance â€“ What if you are disabled and cannot work? It can take months for federal disability payments to kick in, and those payments will not provide a lot of money to care for your family. You may have group disability at work, but does it cover you 24/7, or does it only cover accidents at work? You can often add disability coverage to a life insurance policy, and you should consider it when shopping for coverage.
Finding Insurance For Young Families
Young parents usually do not have much insurance experience, and policies may seem confusing. You should get in touch with local agents as well as getting online insurance quotes in order to get a better grasp on what sort of budget you need to look at in order to have the appropriate level of coverage for you and your family.
This article was written by Barbara Waltz one of the founders of 247QuoteUs.com, an online resource blog and insurance quote comparison guide.