Being a single parent often requires juggling a host of responsibilities. In cases where only a mother or father is providing all of the financial and emotional support, life insurance can provide peace of mind. The following is a helpful guide on what single parents need to know about ensuring coverage is in place to protect their kids from the unexpected.

Why Life Insurance Is Needed

Consider the current expenses it takes to care for your children. From day care and clothing to food and health treatments, the figures add up. Now, think about what would happen to your kids if something happened to you. A life insurance offers a financial safety net that ensures funds will be there to help cover the costs to help your children. Without a policy, the burden may fall on family members who might not be in a position to help out.

The Types of Policies Available

The two most common types of policies are term life and permanent. A term plan provides coverage for a certain time frame, typically in increments of 10, 20 or 30 years. During the “term,” premiums are paid, but the children can only receive their death benefits after the single parent dies. No withdrawals are permitted while the policyholder is alive.

For single parents on a tight budget, term insurance is typically the cheapest, and the premium amounts are fixed for the duration. Once the term is up, the policyholder can stick with the same term, choose another, or go with a different life insurance plan altogether.

Permanent life insurance stays in place for as long as the policyholder is alive. The key distinction with this type of coverage is it has cash value, meaning it grows over time. A single parent can borrow money against their policy or even cash the full amount in. Keep in mind taking a loan out will reduce the death benefits earmarked for your children. Like term policies, the premiums are typically fixed for as long as the plan is in place.

How to Choose Coverage Amounts

No two single parents are alike. As rules of thumb, consider your children’s ages, how much debt you have, and if college attendance is in the future plans. An experienced insurance agent can help guide you on selecting a coverage amount that fits your budget and specific needs and wants.

Schommer Insurance in Hastings, MN, takes pride in helping single parents by providing customized coverage to ensure their children will be cared for. As an independent agency, the firm can compare premiums and other features from some of the nation’s leading carriers. If you’ve been thinking about securing life insurance but are overwhelmed by the process, call (651) 319-0699 or go online to schedule a no-pressure consultation and receive a no-obligation rate quote.