College move-in day is soon approaching and that means you are busier than ever. Between last-minute shopping trips, send-off dinners, and trying to make sure everything is ready to go you are probably wondering if you have missed anything. The truth is you probably did miss one big thing… life insurance. If your child or you are taking out student loans to pay for school, you may want to consider life insurance.
Federal student loans are often forgiven if the borrower dies. However, most private student loans don’t offer the same protection. A life insurance policy can be a cost-efficient way to make sure funds are available for the parents or those who would be responsible for paying back the loans in the event the student was to pass away before the loans were repaid.
For a healthy 18-year-old, a term policy providing $100,000 of death benefits may be as inexpensive as $10 per month. For many parents, $10 per month can provide peace of mind that they wouldn’t be responsible for tens of thousands of dollars of debt accrued by their children. It can provide an extra layer of financial protection for any surviving family.
In addition to not being forgiven, your private student loan repayment schedule can become accelerated after a death or could even require immediate repayment in full. This could put the cosigners or next of kin in financial trouble as they struggle to pay off the loan. A life insurance policy would ensure the funds are there to pay off the loan at the time of loss and save any loved ones from financial troubles.
Student loans aren’t the only way to pay for a college education. Parents of students can finance their child’s education through various methods, including home equity and 401K loans. If the student dies prematurely, these debts still need to be paid off, which can take a heavy financial toll on a family.
A life insurance policy on the total amount of their expected college debt will help cover these expenses. College is expensive. To cover family members in the event of a student’s untimely death, a life insurance policy provides financial protection from unpaid loans and other debts.
Call us today at 844-GANNONS to discuss your options with our licensed experts and get peace of mind!