Laying the Foundation for a Grandchild’s Future with a Gift that Lasts a Lifetime

The joy on a young grandchild’s face when he or she opens a present from Grandma and Grandpa can be priceless, even if the gift is sure to be short-lived and soon forgotten. In today’s world of immediate gratification, where needs and wants rarely go unmet, gift giving can be a challenge for grandparents. The financial value of a lifetime of birthday and holiday presents can be substantial.

Looking to the Future
When grandchildren are young, it can be difficult to imagine them as adults with families of their own, even if it is likely to become a reality one day. The time it takes for a grandchild to go from taking his first steps to walking down the aisle can seem to pass in the blink of an eye.

As adults, the most cherished memories grandchildren will have of their grandparents will be of the times spent together, the stories told and the lessons learned from Grandma and Grandpa, more so than the presents they received.

A “cash value” permanent life insurance policy can last a lifetime and be an important part of a grandchild’s financial future.

Giving “Outside the Box”
Grandparents have an opportunity to leave a legacy with their grandchildren through the gift of permanent life insurance. Permanent life insurance can provide a “safety net” of financial security and protection in a way no other financial instrument can.

Some people may be uncomfortable with the idea of purchasing permanent life insurance on a child. Taking a closer look at the long-term benefits to the grandchild makes it clear why this financial instrument is a worthwhile option.

Some advantages of purchasing life insurance on a young child include:

The premium of a permanent life insurance policy is substantially lower for a policy that insures a child than for one which insures an adult.
The grandchild is guaranteed the ability to have permanent life insurance protection for his or her future family regardless of any changes in health down the road.

In addition to providing insurance protection, permanent life insurance offers a wider range of options and flexibility than many other financial tools. It provides:

A low-risk means of creating a financial asset which grows tax-deferred.
A financial resource which can be used to help pay education expenses without affecting eligibility for financial aid.
A source of cash value which, if not needed for education purposes, can be used for anything a grandchild may need down the road such as a first car, wedding, down payment on a first home or even starting a business

In many cases, grandparents take out a permanent life insurance policy on their grandchild, name the parent as owner and beneficiary and pay the premium each year. This approach gives the parent control of the policy and the option to eventually transfer ownership of the policy to the grandchild after he or she becomes an adult.

A Stable, Reliable Choice
If you own a permanent life insurance policy from Northwestern Mutual, you can appreciate the benefits such a solid financial instrument can provide. Considering Northwestern Mutual’s history of industry-leading dividend performance, imagine what a “cash value” permanent life insurance policy from Northwestern Mutual might be worth today had your grandparents purchased one for you as a small child.

While you may not find “life insurance” on a grandchild’s wish list, the lifetime of financial protection and security a permanent life insurance policy can provide someday may be more than he or she could have ever hoped for.

Depending on the products and/or services being recommended or considered, refer to the appropriate disclosure brochure for important information on the Northwestern Mutual Wealth Management Company, its services, fees and conflicts of interest before investing or engaging in financial planning services. To obtain a copy of one or more of these brochures, contact your representative.

Northwestern Mutual Financial Network is the marketing name for the sales and distribution arm of The Northwestern Mutual Life Insurance Company, Milwaukee, WI (NM), and its subsidiaries and affiliates. Michael J Kavanagh is a Representative of Northwestern Mutual Wealth Management Company®, Milwaukee, WI (WMC), a wholly-owned company of NM and limited purpose federal savings bank. WMC is not a broker-dealer or insurance company. All WMC products and services are offered only by properly credentialed Representatives who operate from agency offices of WMC. Representative is an Insurance Agent of NM (life insurance, annuities and disability income insurance), and Northwestern Long Term Care Insurance Company (NLTC), a subsidiary of NM (long-term care insurance), and a Registered Representative of Northwestern Mutual Investment Services, LLC (NMIS), 6235 Morrison Blvd, Charlotte, NC 28211-3508, 704-365-2014, a wholly-owned company of NM, registered investment adviser, broker-dealer and member FINRA (www.finra.org) and SIPC (www.sipc.org). Representative may also be an Investment Adviser Representative of NMIS. NM and the Northwestern Mutual Financial Network - Charlotte are not broker-dealers, registered investment advisers or federal savings banks. There may be instances when this agent represents insurance companies in addition to NM or its affiliates.

Investment products are not insured by the FDIC, are not deposits or other obligations of, or guaranteed by, NMWMC or its affiliates and are subject to investment risks, including possible loss of the principal amount invested.

The products and services referenced are offered and sold only by appropriately appointed and licensed entities and Network Representatives. Network Representatives and their staff might not represent all entities shown or provide all the services discussed on this Web site. Not all products and services are available in all states.

Michael J Kavanagh is primarily licensed in North Carolina and may be licensed in other states.

Certified Financial Planner Board of Standards Inc. owns the certification marks CFP, Certified Financial Planner and CFP (with flame logo)®, which it awards to individuals who successfully complete initial and ongoing certification requirements.