Life Insurance for Couples with Young Children
In its basic form, life insurance is about solving for confidence and “peace of mind”. Life insurance for couples is no different.
To really help you in your search, start by saying “life insurance is for peace of mind” 10 times in your best buddha pose. BTW, if you need help with this click here for immediate success with this quirky but useful task.
If you have kids, you likely have a need for (large amounts of low cost) life insurance. This holds true regardless of your relationship. You have insurable interest if a child or children are in the picture. Again, regardless of your in you are married, divorced, separated, in a non-traditional relationship, or the like, you need peace of mind.
Really! Life insurance for couples is just as simple as any life insurance solution. You are best to understand your need, review your options, and secure a solid solution.
Solving for the Need
How much is enough? A good needs analysis will solve for this question. Without getting too nerdy, you want solve for the need. I’ll dig bit deeper in solving for life insurance for couples, but at the end of the day, you want to make sure that you leave your loved ones equal or better off financially.
Not solving for the need is like going grocery shopping on an empty stomach. My father always would say if I couldn’t finish my food, “your eyes are bigger than your stomach”.
When purchasing life insurance for couples, be prepared. Make a list of your specific need, then go shopping for that exact solution.
DIME! “Just tell me”
The words “dime” literally mean “just tell me” they come from the verb Decir = to say/tell in Spanish. It is likely to be a shortened version of digame = tell me which spanish speaking people often use in telephone calls to start a conversation.
In life insurance planning, I use it to describe the 4 basic reasons for purchasing life insurance for couples with young children. Let’s break it down in our best cheerleading voice:
- Debt: at death, you want all of your debt paid off so no one inherits your responsibilities. Anything owed, add it up and total it. A short list might start with car loans, credit cards, student loans, hospital bills, and burial expense. Don’t be a jerk and leave anyone hanging especially if they co-signed for you. Own your responsibilities.
- Income: this is the income that you will need to replace if someone like your significant other or children need. One year is not likely enough, but somewhere in the range of 5 to 10 years is powerful.
- Mortgage: Not everyone has a mortgage, but if you do should factor this into your policy coverage. Life insurance companies have come along way. You can dial in your exact years of insurance needed till your home is paid off. This is a nice life insurance for couples solution.
- Education: The cost of most in state colleges are around $100,000 for a 4 year degree. Add in inflation and subtract any known educational benefit like a college savings plan.
Give me a “D”, Give me an “I”, give me a “M”, give me an “E”… What’s that spell? If you said this in english, it’s worth 10¢. Let’s move on.
Buying the Policy
For most young couples, you will want to purchase Term LIfe insurance. Term insurance is the undisputed champion for best value and low cost solutions. It is a great way to own large amounts of low cost life insurance.
Life insurance for couples with young kids, likely means that you need a life insurance policy north of $500,000. You can spend a lot of money and time looking outside of Term Life Insurance. Don’t bother or be told otherwise, purchase term.
Term Life insurance is not for everyone. But if you found this article because you needed a low cost solution to fully cover your life insurance for couples need, you need not pay more. Not a DIME more.
Tip for planning
I have found that cross ownership of the policy works well to ensure coverage. Cross ownership is when you own a policy on each other. The owner can change the beneficiary. If you already own a policy, ownership can be transferred in most cases.
Real Life Example
Kim and John have a child together but neither of them care to get married. The couple have a great working relationship, but neither see the need or have the desire to wed. Regarding their life insurance for couples need, their future relationship status does not matter much. Their life insurance solution for protecting their mutual dreams of their child’s upbringing and education are secure.
Kim and John both own life insurance on each other. John pays for his own policy that Kim owns and is the beneficiary. Kim also pays for her policy that John owns and is the listed beneficiary. The reason for this strategy is that only the owner can make changes to the policy. If either party chose to change the beneficiary, only the owner could allow such a change.
In other words, neither can screw over the other by changing the beneficiary to a third party. Only the owner can make a beneficiary change.
You may also want to review best life insurance options for children if your children are young and under your support. As a parent, you are best to have a solid life insurance plan in place for your family and your children. A common low cost solutions is a child rider.
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Jose, Hoser, Joe from the Show