There is a very simple and cost-effective way to help protect your family financially from the death of a parent, or even the possibility of both.
Now I know what many of you are going to say, “Here goes another sales pitch to buy life insurance”. This is not what this article is about, but if you have children you have a responsibility to consider what I’m about to say. For those with life insurance through work or other don’t think this article isn’t important to you, chances are you are under-insured.
First of all I’m a Certified Financial Planner that derives the majority of his income from managing money. Yes I do offer insurance, but mainly due to the essential need of my clients. It is in my professional opinion that if you have children you either already have a substantial amount of wealth to sustain their upbringing if you were to die, or you need life insurance. It’s really as simple as that and anything else is irresponsible.
Talking about death is never an exciting topic of conversation but one that needs to happen on occasion so you can plan for the what if? This article is in no way uplifting nor is it intended to entertain you. I hope by taking a moment to consider or even imagine the unimaginable happening you will take the steps to ensure your family is properly protected, and that is my only goal of this article.
We all know that children are expensive. For those that are about to have their first you will soon learn the truths of the myth. But if you were to ask the majority of people an actual cost they really wouldn’t be able to give you a number. What I can tell you is, there have been many studies on this with numbers of varying degree. As a consensus it would be safe to suggest raising a child to the age of 18 will cost you $250,000. That is just 1 child based on an average in Canada. I’m not going to go into detail about the metrics used to calculate this but if you live in Vancouver or Toronto I’m going to suggest this number is definitely more.
I bring this number up because it is very important. If you were to die who is going to pick up this financial burden. The basic responsibility and commitment alone of raising someone else’s child is already more than a person can ask, but then there is the financial responsibility that goes along with it.
For a lot of Canadians raising a family with 2 incomes, they still find it a financial challenge to make ends meet. I want you to ask yourself… If something were to happen to you or your spouse would your family still be able to remain in the home? Will your children be able to still grow up in the lifestyle you always hoped? Are their dreams of University still viable?
Listen I know you think this will never happen to me or at least until you grow old. Chances are statistically you are right, but what happens if you’re wrong? I have had friends die suddenly and have seen the effects to the families financially. Some had enough life insurance that the family was going to be alright. I have also experienced others where there was not enough or no coverage at all. This left the surviving family not just dealing with the death of a loved one, but with some big financial issues moving forward. Life Insurance can be a very cost-effective solution. I only ask you to look into how much it will cost to properly protect your family. For those with your typical mortgage insurance coverage, you are on the right path, but there is also better alternative for you as well. This I will cover in another article down the road.
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