Whole Life Insurance/Universal Life Insurance

Financial Education Center > Paying For College

Parental Loans for Learning

Unlike term life insurance, which pays your beneficiaries only when you die, the value of a whole life policy can be accessed during your lifetime by taking a loan secured by the cash surrender value of the policy. These loans usually have a relatively low interest rate.

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This type of policy uses one portion of your annual premium for life insurance and invests the other portion in an account where the interest compounds on a tax-deferred basis. When your child is ready to start college, this could be a good source of funds.

IMPORTANT NOTE: If you don't pay the money back, or you die with the loan still due, the amount of the loan will reduce the death benefit.

Not FDIC Insured	Not Bank Guaranteed	May Lose Value
Not a Bank Deposit	Not Insured by Any Federal Government Agency

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NHTrust is a trade name of New Hampshire Trust Company. Brokerage services are offered through Osaic Institutions, Inc., Member FINRA/SIPC. Investment and insurance products are subject to investment risk, including the possible loss of value. Products and services made available through Osaic Institutions are not insured by the FDIC or any other agency of the United States and are not deposits or obligations of nor guaranteed or insured by any bank or bank affiliate. Osaic Institutions and NHTrust not affiliated.