CNN Money recently reported about the family of a young woman who passed away suddenly. The women had $100,000 worth of student loan debt when she passed away, which her parents inherited. Because they couldn't afford to make the payments, the debt continued to pile up until it reached $200,000.
This story got a lot of press coverage, and the lending company finally agreed to work with them to lower the debt. Other families face this struggle every day and most are not able to work out a deal with the lending company, so the debt continues to pile up.
Although there are ways to reduce education costs, most students still have to take out loans to pay for their education. Because this is a time when young people are thinking about what to do with their future, they don't often consider what would happen to their families if they should pass away.
The good news is that there are things that can be done to prevent these situations. For students with expensive student loans, index universal life insurance is a great solution. With low monthly premiums, students can earn interest on their money while they're attending school. If the student passes away, the family will receive a death benefit, which they can use to pay off the loans. If the student lives a long life, the money in the policy can be used to pay off the student loans or any other expenses. This protects both the student and the family from ending up in a terrible financial situation.
Index universal life insurance can also be used to save up for college expenses, so that the child doesn't have to take out loans to begin with. If the policy is taken out years before the child attends college, the policy could build up enough to cover their school expenses. Unlike other college savings plans, you don't have to use the money strictly for educational purposes, so you won't be penalized if your child decides not to go to college, or needs the money for something else.
If you'd like to prevent yourself or your family from falling into deep student loan debt, we can help. The agents at Family Protection Center help families like yours every day, and would be happy to provide you with a free quote. Just fill out the form to the right, or visit our page for those with Student Loans and fill out the form there. A licensed insurance professional will contact you to help you with your coverage needs.
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