5 Reasons We Have Cash Value Life Insurance on our Kids

BY Justin Scott - Live Legendary

A MINIMUM AMOUNT FOR A MAX FUTURE

My wife and I have life insurance policies on our kids because we want to ensure they are taken care of financially if something happens to one of us. My wife and I contribute a minimum of $200 monthly toward each of our children's policies and come with the ability to overfund these accounts, which we do as much as possible.

IT GIVES THEM A HEAD START

The life insurance policy we took out on them would give them capital that grows tax-free and uninterrupted. Using an IUL as a supercharged savings account, my children will have complete control over their future. No need to accumulate debt when they go to college, start a business or buy a house. If that is not in the plans, they can access money to do whatever their heart desires without asking a bank for a loan. It is also a great head start for a tax-free retirement account.

TAX-FREE BENEFITS

One of the best things about having life insurance policies on your kids is that the benefits are tax-free. They can accumulate wealth 100% tax-free, Withdraw 100% tax-free, & they have a tax-free death benefit if God-forbid anything were to happen to them when they have a family. In addition, there are living benefits that would help us cover any expenses that health insurance doesn't.

WE ARE THE OWNERS

We have total control over their children's accounts even after they turn 18. We educate our kids on how money works, how to keep it from being taxed, and how to create more assets with their wealth, and we will turn the policies over to them when they are ready. We can use the funds until we turn the policies over to them.

TEACH MONEY MANAGEMENT SKILLS

We teach our kids proper money management skills. Not by telling them but by getting them involved with managing their IULs. They can take loans from their contracts for their first car, weddings, etc., and pay them back if they want to at a low or 0% interest rate.

*Disclosures: Educational purposes only. No statements should be considered advice. Past performance and numbers do not guarantee future results. Life insurance is not an investment.

"When the government creates a problem and gives you a break, it benefits them more than you. In the case of taxation, they could help consumers by cutting taxes; instead, they offer “tax breaks” such as retirement and pension plans"