If there’s one thing college kids aren’t worried about, it’s life insurance, but there are some benefits to planning ahead when you’re so young. While not every college student needs life insurance coverage, there are some circumstances that make it worth at least considering. Parents might also wonder whether they need to buy life insurance for their college students. If you’re a cosigner on their student loans, then talking to them about life insurance is an important part of protecting yourself and financial stability.
Married Students Should Always Get Coverage
Although the majority of students are single or dating, there are still many who are married. You may have gone back to school later in adulthood or tied the knot to your high school sweetheart shortly after graduation. Whatever the case, having coverage is the best way to protect your spouse in the event of your death. Your partner and any dependents, including your children, will be taken care of financially even if you didn’t have a lot of personal savings to leave behind. You can also specify to leave money to your parents. Before getting married, make sure you discuss life planning with your spouse. You should both have peace of mind that you’ll be financially secure even if one of you passes away prematurely.
It’s a Good Way to Plan for Retirement
There are a lot of ways you can start planning for retirement in your 20s, and it’s more important than ever with the high cost of living and economic crises. You might already know about whole life insurance with a cash value, but you don’t have to sell your policy to make money later. By the time you’re 70 and ready to retire, you may qualify for a life settlement. You can get an instant valuation of your policy and figure out how much it could be worth through Dawn Life Settlements.
Many college students are more prepared for the future than their parents or grandparents. They know it’s important to think ahead about financial investments, and even in their 20s, some are opening their own retirement funds. Life insurance has the added benefit of still being useful to your loved ones if you pass away before you’re old enough to cash in on it.
It Can Cover Your Private Student Loans
If you pass away before you pay off your student debt, your parents may become accountable. Cosigners assume legal responsibility for private student loans in the event the borrow passes away; federal student loans are forgiven in the event of death, but private loans often require immediate repayment or have a payment schedule that is accelerated. Your parents who cosigned will now have to pay all your student debt on top of funeral expenses.
To avoid putting them in this position, getting a policy is the best way to protect them. Parents may think about how to help their college students secure life insurance. They may not understand how it all works, so work with them to choose the right policy and save as much money as possible.