Jayson Lowe explains why he requires his kids to buy their own whole-life insurance policies instead of gifting them. He's seen parents give policies to children who then surrender them, not understanding what they had. His family makes ownership a condition of staying in the trust.
Having very clear conversations as a family, explaining what's in the family constitution, you know, as it relates to, for example, for our kids, Sebastian, as you're well aware, the policies that Rebecca and I own and our children are the lives insured. Our children are not going to get any of those policies unless they buy those policies from us. Our children are going to be expected to create and own their own policies. And in order to participate in the family trust and, and And to be a part of that, they have to maintain premium payments in their own personally owned. I've seen, and again, horror stories: parents who their intentions are wonderful; they want to gift an asset to their kids. So they say, "Hey, I've been funding this policy, Billy, since you were born. You're 18 now. Here's the policy." Billy's gonna go. It has cash surrender value. Who do I call to get my hands on this money tomorrow? And that policy will be surrendered before you know it. And so the parents had every great intention, but there was an absence of communication. or clarity somewhere, and Billy takes that asset that was gifted to him, which Rebecca and I will never do for our kids. That asset has value. If you want to own it, you're buying it, no different than what you would do outside of the family. And we've experienced those horror stories, and we can't go back to the parents because the moment that the ownership transfers, we can't talk to the parents anymore. Mm-hmm. So we can talk to the young adult and say, it would be foolish for you to surrender this. And the young adult's like, I've already made up my mind, surrender it. So parents, you're still on and you've got policies on your kids, please, I implore you, do not ever gift those contracts to your kids. If you want to know how we do it in the way of letting our kids know how they can buy it, I'm happy to share that with you. But please, I implore you, don't gift it to them. You are setting them up for failure, not for success. Want to find out more about how you can become your own banker? Click the link below or head over to learnwithjay.com. That's learnwithjay.com.
