Often times when discussing life insurance you tend to think about your partner and children, however, there is another discourse to consider – your parents. It’s not uncommon for parents to leave an inheritance for their children. This inheritance can be in the form of houses, land, vehicles, etc. Did you know that your parents can also leave you an inheritance by utilizing life insurance? This may seem unusual or even rude to just think about, you aren’t the only one who thinks this way! Rest assured, life insurance is a wise financial move to make and would be something your parents want you to do. It’s all about securing the very essence of your family’s legacy and everything they have worked hard for.
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Why Get Life Insurance on Your Parents?
From birth, your parents have dedicated years of their life to nurturing you, cheering you on from the sidelines, and lent a hand when you needed it the most. Now, you’ve made it to a point where you might have kids of your own or own a home. Running a home and family can be a lot to handle and you probably realize if you stopped working today, you wouldn’t be able to keep up the lifestyle you’ve worked so hard for. Consider the impact of losing a parent, not only are you grieving while working and running a home, you also have to plan and arrange a funeral. This is where life insurance comes in. It not only eases the burden of planning a funeral, it also helps to keep your inheritance intact and preserve your family legacy.
Peace of Mind for You and Them
Parents often stress out about their kids. Think about when you were young and out late on your bike and hadn’t been home for eight hours. You probably would have come home to search parties in your yard trying to find you. A parent’s worry doesn’t stop just because you are getting older. Depending on who you are, it could be even more stressful now that you have kids and a mortgage to look after!
What would your parents think if you had to pay $15,000 for a funeral for each of them? I don’t know about you, but my father is the kind of guy who hands his credit card to the server before anyone else can and pays for the whole meal. The thought of me paying that much for his funeral would probably make him sick to his stomach. But that’s why we have a plan in place. A life insurance policy can range greatly in the death benefit, and can be designed to fit both of your needs and can fit any budget. It’s a symbol of gratitude that shows that you will preserve what your parents have worked hard for.
Navigating the Complexity of Life Insurance
There are more factors that go along with life insurance than you may realize. Your parents age, medical history, their weight, and more. Ownership, beneficiaries, and payment are other key details to consider.
Lets face it – you might feel an inkling of shame for thinking about how to benefit from a passing of a loved one. Especially the people who raised you up in this world. But it doesn’t have to be this way! It is wise for both you and your parents- they don’t want to see their children or grandchildren suffer financially, and you shouldn’t either.
The best thing you can do is have a clear and open conversation about it. Determine who really should be the owner of the policy. Decide who the beneficiaries are and how the death benefit will be divided up. The implications here determine who maintains the policy and who will receive money, which can often be the hardest part of the process. That is why you have advisors, like us at Heritage, who know the ins and outs, and will help you along with the journey.
Planning for the Future of Your Family
One of the most captivating facets of life insurance that probably already occurred to you was estate planning. For the savvy, the lump sum death benefit can be used to cement your family’s legacy and ease tensions between family members in a time of uncertainty.
You might be wondering what is in the legacy I keep mentioning. It could include the home you grew up in where you had all those Christmas morning memories. It could be the cabin you spent summers at reading cowboy books with your dad. Or it could be the values your mom taught you – what would she think of your parenting if you had to work 100 hours a week away from your kids?
It can also be a tool to equalize inheritances. Perhaps your parents have multiple assets that can be hard to divide evenly. One sibling might inherit the family business, and the other their old home. With a good plan in place, everyone can be happy regardless of the type of assets.
Like planting a tree, the best time to get life insurance was 5 years ago… the next best time is today!