<prompt> Human: Here is the situation: my wife and I just got policies from Northwestern Mutual for our family. The wife and I each have a term 60 plan with death benefit of 500,000 and our premiums are 21 a month, which I think is pretty decent. In addition, we got coverage for our two children who are ages one and three and each of their plans are whole life for about 32 a month 50k death benefits plus cash value, which I thought was insane and was against. My wife persuaded me that the plan was good because of the cash value as a long term investment for our kids. My main concern here to you guys is that you help me see if this is a good or bad financial decision. Please look at my info first though.Initially I was pretty skeptical and against getting whole life insurance for our kids and I figured that there were better savings and investment vehicles to utilize, but as I look into the information, I am having trouble seeing if its that bad of an idea. I pretty much decided that I dont want to do a 529 mainly because I cant be sure if my kids will actually go to college or not and I saw a lot of things about penalties if you dont do it right. I was also considering something like a Roth IRA but comparing that to the cash value of the whole life insurance plan seems like it has about the same benefit as far as I can see, at least for now.Specific information: The wife and I only make about 45,000 a year combined and we pretty much live paycheck to paycheck, breaking even with bills and everything, with minor debt we are paying off. So essentially we dont have much savings put away for our kids right now. So having whole life insurance on our two kids is sort of a forced savings plan so that the money is put away 64month and we cant touch it. Also, we do want coverage for our kids in case something happens and we have to pay for a funeral my wife has a few friends who have lost children so its something that weve considered. So here are the numbers showing the plan for one of our two children. I highlighted the one column in green which shows the cash surrender value and the column to the left of that is how much we will have put into the policy at that point. As you can see, by year 19 which is when my kid will be 19 the cash value starts becoming more than we will have put into the policy. So going forward from that point, we wont have lost any money and each kid has money they can use for whatever they need when they move out. I dont expect them to keep the life insurance policy unless they want to.So in a nutshell, we want our kids to have something when they are ready to move out and go to college. Each of them will be able to have around 8,000 or more after twenty years. I know it may not be a lot to some people, but at least its something.  <response>: IMO, if you really need insurance for you on your children, you should probably buy a term policy, which would be cheaper and put the money you saved on those premiums into another investment vehicle. Like aBoglehead said, why would you need it? When you purchase insurance, you are paying an insurance company to assume the risk of something happening, i.e. your business partner dies, your spouse dies and you dont work, or your house burns down. What risk are they assuming if your child dies except for burial expenses? Edited for punctuation. 