Motherhood is difficult for sure. But the walk is even more thorny if you are a single mom. The responsibilities are overwhelming and the insecurities are at their peak. However, raising a child comes with its own perks for a single mom. With exponentially increasing expenses of academics, healthcare, food, and living, the most challenging part is the financial responsibility. As a parent it’s your duty to provide the best possible education and lifestyle to your child and you leave no stone unturned to fulfill that. But what if you die suddenly? As unpleasant as it might sound, it is the bitter truth that would hit you at any point of time. Life insurance is, therefore, your ultimate financial protection plan for your child’s future. What is Life Insurance?
Life insurance is a contractual agreement between you and the insurance company. The insurance company will pay an amount in exchange for premium payments collected from you. The company’s amount is also known as a death benefit, and your beneficiaries will receive the amount after your death. Your beneficiaries can utilize the money for any purpose like bill payments, mortgage, or educational fees. So, having life insurance is important for your child, so they don’t suffer any financial crisis after your passing away. However, there are two types of insurance.
Term Life Insurance
Term life Insurance is one of the most popular and affordable life insurances available in the market. It offers insurance coverage for a certain amount of time, but the premium payments remain the same throughout the policy. The length of the policies ranges from 10 to 30 years.
Permanent Life Insurance
Permanent life insurance is more expensive than term life insurance and also provides lifelong coverage. Basically, the policy lasts till your death, as long as you pay the premiums. The cash value element of your insurance collects on a tax-deferred basis over the policy term. So, you can borrow against your policy’s cash value.
Why Does a Single Mom Need Life Insurance? Life insurance is a must-have for anyone who has a family. However, here are a few reasons to justify why single moms need life insurance.
If you have any debt, consider life insurance to cover all of it. Thus, after your passing, your kids don’t face any financial trouble.
Life insurance can take care of the child’s expenses after your death. Since they will need money for food, transportation, living, and clothing, being a single mom, you must secure that.
Nowadays, education is very costly. So, you can ensure that your child pursues academics without any financial problem by taking life insurance.
Choose Your Insurance Beneficiary Wisely
As you are a single mom, you might choose your child as your beneficiary. But life insurance companies won’t pay the amount if your child is a minor. So, you have to keep an adult guardian for the benefits if you name your child as the beneficiary. In case if you fail to build trust on anyone or fail to make an arrangement, the court will appoint a guardian. It is a costly process, but the guardian will take care of the money until your child reaches adult age. Conclusion Life insurance is essential, especially if you are a single mom. It will take care of the financial needs of your child and secure his or her future. If you are a single mother, do get your life insurance policy done considering all the needs in mind.
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