What Is The Best Asset to Gift to your Children or Grandchildren?

by Apr 20, 2016

Home Page » What Is The Best Asset to Gift to your Children or Grandchildren?

When it comes to our kids, what won’t we give them? A vacation home, stocks, bonds, all the tea in China. Lately we have been exploring Paid-up Life Insurance Policies and think this is something worthwhile to consider for children, and not simply because of the death benefit.

A permanent life insurance policy is a unique asset:

1) It builds cash value that grows on a tax-deferred basis while the policy is in force.

2) The cost is nominal as compared to other life insurance policies.

3) The overwhelming majority of the cash grows, whether by the simple interest of a mutual insurer, or by the equity (yes, equity) allocation you choose.

4) Start the policy early and it will grow into a substantial asset, you can turn it over to your child at any time, because you control the transfer.

5) You will have access to the cash values at any time while the policy is in force. And though this might seem appealing as a way to fund college, an appreciating asset like this is better kept for emergencies. Not everyone becomes an adult with perfect health, or the economic ability to pay the premiums on a life insurance policy they may in turn need for their family. A child with a paid-up policy has a financial back stop that does not cost them in terms of management or tax reporting while the policy is in force.

It may sound too good to be true, but check it out. The math makes a lot of sense.

If you have questions email Kyle at or call 203.698.9342.

Written by: Steve Shepard

Founder/Principal, Shepard Insurance Group. At Shepard Insurance Group we begin every relationship with a face to face meeting with the client. In a comprehensive discussion of coverage needs, personal concerns, objectives and finally appetite for risk, we can arrive at the proper insurance solution. Understanding the client is the first step to accurate execution.

April 20, 2016

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