The late-in-life parenting phenomenon is not just limited to famous celebrities and tabloid headlines. It is real and parents are getting older. Opinions differ sharply on whether this trend is a good thing or a bad thing. Either way, there are definitely implications for the way children are brought up.
As parents age, financial preparations become even more important than they were before. Here are a few ways to make sure your late-in-life children have all the advantages possible.
Save for College
Driverless cars and other advances may eliminate almost all semi-skilled jobs, such as truck drivers. So, a college education will be an absolute requirement. College will probably not get any cheaper in the future, and when it comes to saving for the future, nothing beats the time value of money. It’s not impossible to play catch-up, but it is certainly not easy. Additionally, many college savings accounts have significant tax advantages for the donors.
Plan for Their Financial Futures
These policies are not just for adults. Whole life insurance plans for children usually have fixed rates for their entire childhood. Moreover, benefits often significantly increase when the children turn 18 without any premium increase. Options increase even more around age 21. Once the child becomes the policy owner, the child can cash in the policy, continue the coverage, or make other decisions. Childhood policies may also offer future peace of mind. Your children might always have coverage, regardless of their health or medical conditions. A human life value calculator might assist you in this entire process.
Take Care of Your Own Financial Future
People usually do not like to think about their own mortality. But a late-in-life child changes the dynamics considerably. Life insurance, like a future college education, becomes an absolute minimum requirement. A good rule of thumb is that your own life insurance policy should cover between eight and ten times your annual salary. If you go with term life as opposed to whole life, and many people make that choice, be sure that the policy remains in effect at least until your youngest child turns 18. Most children are not financially independent until their mid-20s, so consider even longer coverage.
Make a Will
If you die intestate (without a will), the state makes decisions about who will raise your children and where your assets will go. Many times, these decisions are the same ones you might make. But are you willing to take that chance? Furthermore, are you willing to surrender control over your legacy to your children and hope for the best? In most situations, the answers to both these questions is a resounding “no.†The hour or so that you spend with an estate planning lawyer is one of the best investments of time you may ever make.
Also remember to take advantage of every financial resource. Don’t be afraid to ask other family members to pitch in monetarily. Finally, no amount of money can substitute for good parenting. Be open about the mistakes you’ve made in the past and, above all, teach your children the value of money from an early age.
About AEGON Life
Launched in July 2008 with pan-India operations, AEGON Life Insurance Company Limited
has a vision to be the most recommended new age life insurance company. As a joint venture
between AEGON – world’s leading financial services and Bennett, Coleman & Company –
India’s leading media house, AEGON Life Insurance adopts the power of global expertise to
facilitate a direct to customer approach, leveraging digital platforms to bring transparent
solutions, and to prioritize customer’s needs. Our product portfolio includes term life
insurance plan, pension plans, unit-linked insurance plans (ULIPs), health insurance plans,
child education plans, and more.
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