The need for parents to consider taking out life insurance has been highlighted recently. LIFE (Life and Health Insurance Foundation for Education) recently awarded $105,000 worth of Scholarships to students who could not afford to pay for college because a parent had died.

Parents who die without Life Insurance Scupper College Plans for Children

LIFE reported on the case of Esther Kim who was only 16 when her dad died of cancer – he didn’t have any life insurance, which left her and her family financially insecure. Esther had always been a straight ‘A’ student and had always planned to go to College, but the bereavement looked set to put her plans on hold, since she, along with her mom had to work flat out in order to keep the family going.

Luckily for Esther she now has the chance to start a course at Oglethorpe University. She has achieved this by using money she saved herself, as well as a student loan and a scholarship worth $10,000 from the not for profit organization LIFE.

Parents have to Consider Children’s Future should they Die Prematurely

Mr Marvin H Feldman, President and CEO of LIFE Foundation stated “ When parents die prematurely without adequate life insurance, the people who depend on them most – their children – often face difficult financial realities that can force their dreams of a higher education and a better life to be put on hold.” “We are proud to be able to help deserving young people like Esther and our other scholarship recipients to reach their college goals, and we hope their stories will remind all parents to protect the financial well-being of their loved ones through proper financial planning.”

The LIFE Lessons Scholarship Program offers scholarships to students who are unable to afford a college education due to a parent dying with negligible or no life insurance. During the last year 59 American students received awards from the Foundation – in order to qualify students had to make a video, or write about the financial consequences of losing their mom or dad.

The judges included members of the LIFE Board, as well as Life Insurance company executives, from some of the top US Life Insurance companies. One of the scholarships was awarded as a result of an online vote – Mashell Ewing was the winner, for describing how difficult her financial circumstances had become since the death of her single mom.

Single Parents need to Consider Life Insurance as a Priority

Mashell’s mom died suddenly of a heart attack having made no provision for life insurance. Since then Mashel l and her brother both had to work long hours just to pay the rent and care for their younger sister. Despite this Mashell managed to secure a place at the University of California, Berkeley and so determined was she, she took out loans to help pay for college fees. The extra $5000 dollars awarded to her last year by LIFE will help her achieve her plan to graduate this May.

The LIFE foundation was set up in 1994 with the aim of educating the public about life, health, disability, and long-term care insurance.

Source: lifehappens.org/content

photo credit: ralph and jenny

Limited Pay Policies Up By 152%

As Michael Ferik, Senior VP for independent life cover at Guardian Life, speaking at Guardian Whole Life International Forum on October 5 stated “This finding underscores a pronounced desire among Millenials and Gen Xers for financial security at an early age.” This research seems to be corroborated by the fact that sales of ‘limited pay’ life policies at Guardian life – policies which can be paid off over a shorter term, were up by a massive 152% year on year to June this year.

Young Life Policy Buyers Plan their Financial Futures

According to the Guardian survey, 74% of those aged 40 and under stated that they wanted to be more financially stable sooner rather than later, with 76% or respondents saying it was very important for them to be debt free in the near future. In contrast, those aged 40 or older attached less importance to having financial stability or leaving debts behind at 69% and 68% respectively. Mr Ferik believes this could be down to the heavy burden of student debt which younger people have had to deal with which has been reflected in a “desire to be debt free” rather than the more typical baby boomers who have more of a “live for today” attitude.

Protecting Families Number One Reason for Buying Life Insurance

The main reason given by the under 40′s for purchasing life insurance was to protect their families (72%) Those aged over 40 also gave this reason with 79% giving it as the driving motivation. Both age groups also counted the cash payout as the second biggest reason for taking out life coverage.

The results seem to indicate that younger buyers see whole life insurance as less of an ‘insurance product’ but rather as one of a number of assets which can be used to build a stable financial future. According to Ferik “They see whole life’s benefits for meeting unanticipated financial needs that arrive while still alive as better than borrowing from a 401K plan or – for now at least – betting on the stock market.”

Source: Insurancenewsnet.com

photo credit: faungg

Skydiving is a high-risk activity, which means life insurance companies will charge more.

As extreme pastimes go, mountaineering must be one of the riskiest, and the ultimate achievement for climbers is still conquering the highest peak in the world, Mount Everest. Last month saw yet another attempt on the summit succeed. At thirteen years old, American Jordan Romero has become the youngest climber ever to reach the top of Everest. Jordan, who hails from Big Bear California, reached the summit on May 23^rd, earlier than planned, and the first thing he did was to call his stepmother.  Speaking to her via satellite phone he told her “Mom, I’m calling you from the top of the world”.

Good News: Young People Most Likely to Partake, Which Means Lower Life Insurance Costs

Dismissing criticisms that Jordan is too young to be participating in such highly risky mountaineering activities, his stepmother, Karen said that Antarctica, which is next on Jordan’s list would be “a piece of cake”. She described Jordan as a quiet boy and “no thrill seeker.” In fact he took schoolbooks with him on the expedition to study for when he had some “downtime” in the tents.

Mountaineering Is a Highly Risky Pastime

Bungee Jumping is also a high-risk sport. Life insurance companies will set their premiums appropriately to factor in this added risk.

photo credit (top to bottom): oncethiswas, LaBellaVida

Massachusetts Mutual Life Insurance Company’s LifeBridge program is a philanthropic program intended to help provide education to children of working parents. Since 2002, MassMutual has been offering free ten-year, $50,000 term life insurance policies to eligible families. In order to qualify, says MassMutual, a family must be in a good health and earn between $10,000 to $40,000 a year.

Any benefits paid through LifeBridge are distributed into a trust, which pays for the educational expenses of your child. Should your income go above the income limit after you qualify for LifeBridge, the life policy will still remain in effect and the only exclusion is in the event of suicide within the first two years of the policy.

Whether you’re a full-time or part-timer working parent, you may be eligible, but you should first check with MassMutual. Since the program started about 9,500 free policies have been issued totaling about $450 million in coverage. Since its inception, the LifeBridge program has paid on six claims through the program.

photo credit: atennies94

Most of us know enough to have auto insurance when we do any amount of driving in our car. And having homeowner insurance when you own your own home just makes perfect sense. Then why do many of us put such a low priority on getting any sort of life insurance – especially when we’re younger? The answer usually lies in what’s called ‘the probability factor’ and it keeps a lot of people away from getting the life insurance they should have. What it means is that most people – and especially when you’re talking about younger people – tend to believe that any sort of accident, even one causing death, will only happen to the other guy.

Because people are generally optimistic about their lives, the idea that any sort of accident could happen to them is usually the furthest thing from their mind. Death is what happens to old people, they think but of course, that’s not the case and in fact, many automobile accidents causing death happen to younger people every day.

Group Coverage Isn’t Always Best

Having life insurance – especially when you’re young and starting out with a new family – is simply one of the most responsible purchases you can make for taking care of your family. If you stop to think about what would happen to your family if you were suddenly taken out of the picture, you’d know how hard it will be, not only emotionally but financially as well.

Group Coverage vs Personally Owned Coverage

You may not need millions and millions of dollars worth of coverage, but you should at least acknowledge that if the need is there, you should have enough for your family to be comfortable after you’re gone. Many people have group insurance coverage at their workplace, but what they have to remember is that if they change employers, the coverage generally doesn’t follow them to their next employer. And if you do want to continue the coverage to another employer, it’s usually very costly to do so. Having ‘personally owned’ coverage is usually the best option if you know you may be switching employers over the next few years. That way, you can simply take your coverage to wherever you go to work next, knowing that you and your family are covered.

photo credit: Akuppa

The last thing you want to have to think about when you’re deciding on your life insurance planning and who will benefit after you’re gone, is whether or not your children with special needs will be taken care of properly. Because of their special needs they will have specific financial needs, including medical treatments for possibly their entire adult lives. Children with special needs are still entitled to a good quality of life and the life insurance plan you choose to take care of them should reflect this as well.

You want to have a plan in place that will ensure that not only the financial aspects of their lives will be maintained, but also their physical and social ones as well. It’s very important that the life insurance plan – and benefits – you have in place, outlives your children. In this way, they will not be wanting for financial help throughout their entire adult lives.

Using Estate Planning and Trustees to Ensure Your Child’s Future

Through the use of special trustee plans and other legal methods, your life insurance plan can be set up so that your children with disabilities or other special needs can be well taken care of long after you’re gone. This is done in a variety of ways including talking matters over with a special needs planning group which you can contact through your local mental health departments, or directly with your life insurance broker. In this way you can begin to lay out a plan to ensure that your special needs children are going to be cared for when you are no longer around to do it. By having a trustee appointed to ensure that your last wishes are followed and with a sound financial plan in place, your children should be taken care of for as long as they need to be.

By working closely with your life insurance company, you can set up a special needs plan that will take into account all the aspects of the special care that your child may need in the coming years. Some things to keep in mind when setting up this type of plan can include:

• Proceeds from your insurance plan are generally not subject to probate fees and are usually available almost immediately after the parents’ death
• You need to make sure that the plan takes into account a full lifetime of support for your child including special medical needs that may arise
• The amount of financial benefits in your plan must outlive your child to ensure the quality of life is maintained for their entire adult life

photo credit: Kah Zanon.

It may seem like just a harmless habit that anyone can stop at any time, but smoking tobacco is one of the hardest addictions to break. In young people, the damage from tobacco smoke can also cause lung development to be reduced, which will have an impact on maximum lung functions later in life. Teenagers also are at a much higher risk of addiction because teens become addicted to substances at a much faster rate.

Life Insurance for Sons and Daughters Who Smoke

In addition to your young one being at risk for all of these negative effects, you may find another shocker – and that’s in the pocket-book. Life insurance for your teenager or college-age son or daughter may cost you as much as $350 / month more. That’s because life insurance policies are able to set higher rates for smokers. The way each company sets their premium varies, but it’s often determined by how much tobacco your son or daughter consumes.

Some companies differentiate between light and heavy tobacco usage, while others have two levels of smokers: Standard and Preferred. Your son or daughter will generally fall into the preferred tobacco level, but make no mistake: Premiums will still be significantly higher than they would be if they did not smoke at all.

How to Get Them to Quit

Quitting smoking may be difficult for your young one, but you should try to convince them that chronic bronchitis, heart disease and high risk of stroke are just some of the hazards associated with smoking tobacco. More than half a million Americans die from tobacco-related causes every single year, with the great majority of them having started smoking when they were in their early teens. Smoking can also cause you to look bad. Tobacco smoke dries the skin out and causes wrinkles and can even contribute to premature grey hair and hair loss.

Playing any type of sport is much more difficult when you smoke. Shortness of breath and dizziness will have a detrimental effect on everything you try to do physically. Every year many thousands of people die from complications arising from constantly being around someone who smokes and breathing in their smoke.