Life can be difficult as a single parent. Without another parent to step in, what happens when you are no longer able to take care of your children? If you have a life insurance policy in place, you may have more peace of mind that your children will be taken care of if you pass away.
“Life insurance for single parents is paramount,” says Earl Jones, owner of Earl L. Jones Insurance Agency, a division of Farmers Insurance. “Life insurance gives single parents a lot of options to provide for themselves and their children.”
For single parents, life insurance is a big decision. Finding the best life insurance company for your family’s needs, choosing the right type of policy, deciding on the death benefit amount and choosing beneficiaries are all important steps in your financial plan.
Why single parents need life insurance
As a parent, life insurance can be one of the best protections you give your child. Life insurance can help to safeguard your children’s financial future if you are no longer able to provide them with support.
Brendan O’Brien, a financial planner and life insurance expert with Prudential Advisors, offers an explanation. “Single parents need life insurance to provide for the future expenses of their children if they should pass away. This includes the basic necessities of food, shelter and clothing,” he explains. “Life insurance is meant to replace income and neutralize any debt left by the deceased parent before their child can attain an age of financial independence.”
Life insurance can be a lifeline that your family may need if they suddenly find themselves without your support.
Types of life insurance for single parents
There are several types of life insurance that may be good options for single parents. Term life insurance and permanent life insurance both offer qualities that could make them appealing choices.
Term life insurance
Term life insurance is a form of life insurance that lasts for a set period of time, usually 10 to 30 years.
“I’m a big fan of term life insurance for single parents because it is relatively inexpensive,” says Michael Shea, a certified financial planner and advisor for Applied Capital. “If you’re young and healthy, you should have no problem getting a term policy to keep you insured until your kids are adults and not financially dependent on you.”
Because term life insurance is temporary, it tends to be more affordable than a permanent life policy. However, term policies do expire. You can typically renew term life policies, but you will pay a new premium based on your new age. This means your payments will likely increase with age when you renew the policy.
There are several different kinds of term life insurance policies. A few of them are:
- Level term life insurance: Level …….