How Can Permanent Cash Value Life Insurance Pay for College?
Paying for college gets more expensive every year. Yet, you would do anything to ensure that your child’s education is always within reach. Many families create a combination of methods to pay for school, such as savings plans and investment accounts. But, for some, a permanent life insurance policy can be an excellent way to tap into a low-cost way of paying for education. How does it work? Could it be just what you’ve been looking for?
The Value of Cash Value on Your Life Insurance Policy
A permanent cash value life insurance policy goes into place at any time. The younger, the better. Once in place, this type of insurance policy grows in value. That is, there is a death benefit in place should the policyholder die while it is in place. But it also grows in cash value. That means you may be able to use some of the investment value from the policy to meet your college goals. Here’s how it works:
- You invest in a permanent life insurance policy, make premium payments, and build its value.
- The cash value grows based on the performance of the insurance company. Most permanent life companies are owned by their policyholders. When they have a good year they issue a dividend back to their policyholders. Most often this results in increased cash value.
- When it comes time to pay for college educations, you can withdraw some or all of that cash value to do so.
- There are no taxes on these funds. They are yours to use as you would like to.
- You can do this whenever there is value in the policy.
Is this the right option for you and your family? Many factors play a role here, but for many parents, it can be one of the best ways to access affordability in paying for college. Of course, there are limitations here. The insurance company needs to do well. And, the sooner you put a policy in place, the better.
Let’s talk about how this type of policy can help you to pay for your child’s college education. Call Dimmitt Insurance today to discuss your options at 866-763-6627 or use our online quote request form for a fast solution.
Filed Under: Insurance Advice, Life Insurance | Tagged With: All About Insurance, Insurance, insurance tampa bay, Life Insurance