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Does it make sense to get a Cash Value Life Insurance policy for your kids? Is Life Insurance for Kids expensive? Let's explore the pros and cons of juvenile policies.

Key Points:

Introduction to Juvenile Policies: The discussion introduces the concept of cash value life insurance policies for juveniles, highlighting their potential benefits and addressing common questions regarding their suitability for children.

Pros of Juvenile Policies: Key advantages of these policies include no earned income requirement (unlike Roth IRAs), no age restrictions for accessing funds (avoiding the 59 and a half rule of IRAs), and the significant advantage of time, which allows for compound interest to significantly enhance the policy's value over many years.

Cons of Juvenile Policies: Challenges include the requirement for parents to have coverage often before obtaining a policy for their children, limitations on the amount of coverage based on the parent's own coverage, and policies being generally not priced as competitively for juveniles as for adults.

Comparison to Adult Policies: An example is provided comparing the financial outcomes of policies for a 17yearold and an 18yearold, illustrating that juvenile policies are not always priced advantageously. The example shows that an 18yearold with a preferred plus rate class can secure a policy that may yield better financial outcomes over time compared to a juvenile policy.

Recommendation for Policy Reevaluation: The video suggests reevaluating juvenile policies once the child reaches adulthood to potentially secure a more favorable rate class and improve the policy's financial performance.

This summary provides an overview of the considerations for cash value life insurance policies for juveniles, weighing the pros and cons, and suggesting a strategic approach to optimizing policy value as the child matures.