The only thing as joyful as having a child is having a grandchild. Folks often point out that people act differently as grandparents than they did as parents and want to be able to give their grandchildren a better life. One of the reasons for this is that when you’re a parent, life is busy. You have a job and responsibilities, and when you’re raising a child, you don’t always have the flexibility that grandparents enjoy.
By the time you are a grandparent, things are different. You’re retired and always looking for something to do. What better way to pass the time and keep yourself occupied than spoiling your grandchildren?
As a parent, you have to cover all of the basics, which means keeping your child safe and preparing them for adulthood. Grandparents, on the other hand, get to focus on spoiling their grandchildren.
Of course, it’s not all about spoiling your grandchildren; it’s about giving them a better life. Here is what every grandparent should know about providing grandchildren a better life.
Is it a Good Idea to Invest Money for Your Grandchild’s Future?
Some grandparents invest money for their grandchildren future. Of course, this strategy is more effective when the grandparent has already built up a sizeable portfolio over the years.
If you just started investing because you thought it would be a good way to grow money to pass on to your grandchildren, there are some things you should know.
By starting as an investor late in life, you have to be more careful about your investments. That’s because you don’t have as much time as younger investors to be a long-term investor in equities and expect to earn significant returns over 30+ years.
That means that if you’re 82 and about to invest $10,000 for your grandchildren, you won’t have much time to earn a sizeable return. For example, if you want to turn that ten thousand into twenty thousand, you’ll need to pick individual stocks. They may have the potential to increase in value quickly but will most likely have an increased risk of loss.
Investing in a diversified portfolio is the best way to grow your money over time. However, many seniors have seen an untimely market crash, wipe out 10 years or more of returns or even render certain stocks worthless.
The risk of watching your savings and grandchild’s inheritance decrease significantly is devastating, which is why investing isn’t always the best option.
Should You Create a Trust Fund for Your Grandchild?
Now that you know more about the risks of investing in the stock market as a way to generate money for your grandchildren, you might be wondering about the benefits of creating a trust fund.
People have mixed feelings about trust funds. It all depends on how old your grandchild is and how much you trust them to be fiscally responsible.
Whenever you doubt that your grandchild will know what to do with any money you leave them, you should consider creating a trust fund. By creating a trust fund for your grandchild, you can control how much money they can access at any given time.
For example, you can design a trust fund that only releases funds in specific amounts over particular time intervals. For example, you can create a trust fund that releases $10,000 every two years or one that releases $25,000 every five years. When it comes to a trust fund, you have a lot of control over how the money is distributed.
Trust funds are vital financial instruments that grandparents can use to ensure that their grandchildren will be well taken care of financially.
College Funds for Grandchildren, Are They Worth it?
Thousands of grandparents are obsessed with leaving a college fund for their grandchildren, but is it worth it? More young people are starting to doubt the payoff associated with having a college degree, especially when they pay their way.
The gig economy is growing rapidly, with no signs of slowing down anytime soon. Meanwhile, millions of college graduates are frustrated by the combination of seemingly insurmountable student loans and limited post-graduation opportunities.
Making Sure Your Grandchild Is Financially Secure After Your Passing
As a grandparent, one of the biggest fears is that your grandchild will become destitute. One of the most effective ways to ensure that your grandchild will have enough money to keep them financially stable throughout their adult life is to sell your life insurance policy.
Once you sell your life insurance policy, you can use the money you receive from the sale to create a trust fund. Alternatively, you can choose to leave the money to your grandchild in one lump sum upon your death.
Whether you want your grandchild to practice restraint by paying periodic amounts of money through a trust fund over time or if you want them to have all the money at once, you can fund the trust with a life settlement.
A life settlement refers to the term associated with the process of selling a life insurance policy for a lump sum of money. Thousands of grandparents leave their grandchildren a sizeable sum by selling their life insurance policies.
Give Your Grandchildren the ULTIMATE Gift with MRE Finance
Want to give your grandchildren the gift of a lifetime? Then you need to call the team of experts at MRE Finance to help guide you through the process of how to sell your life insurance policy. We’re here to help you sell your life insurance policy so that you can create a legacy for your grandchild. You can give your grandchildren a head start in life and financial security by selling your life insurance policy through MRE Finance!
For a free estimate of your policy’s potential value, visit https://mrefinance.com/free-life-settlement-calculator/ or call 1-800-521-0770 or visit the website MRE Finance today and ask about how you can benefit from selling your life insurance policy!