Many of my clients, particularly younger clients, may have very little in the way of liquid assets and precious little equity in their house. Nonetheless, if you fall into this category and you have young kids then getting an estate plan in place is still essential and you can still leave a significant estate for your children's benefit by using life insurance.
The perfect life insurance product for a young family may be a "second-to-die" policy. These types of policies do not pay out any proceeds until both spouses die. And since two deaths must occur before the insurance company is forced to shell out any money, the premiums on such policies are surprisingly low...a nice feature for young parents who are still in the early stages of their careers with relatively low salaries.
But be careful...a second-to-die policy may not be ideal when one of the spouses stays at home with the kids. In that situation the working spouse should probably look at a single-life policy to create an income stream for the family if that working spouse is suddenly no longer around to generate income.
In any case, every young family should sit down with a trusted insurance agent and look at the different life insurance options to ensure that the kids can maintain their standard of living by having a support trust funded with life insurance proceeds. And feel free to contact me if you need a life insurance agent referral in the Hartford County area.
But no matter what you do (and I've already written about this) if you have young kids, don't procrastinate with your estate planning.