Life insurance is what responsible people buy when they love someone and they want them financially protected. Life insurance is not a "Go Fund Me" account, where you are leaving your loved one's financial security up to the generosity of strangers. It's bread and butter and self-respect. Life insurance pays a lump-sum, 100% income tax-free so that the people you are responsible for can maintain the quality of life you want them to have. It helps them to pay off the mortgage or rent, or even buy a home outright, skipping the lending process entirely. Or it can at least provide them a buffer, buying them time to make mortgage payments so the home can be sold for its true value, not at a panic discount. It can fund your children's education, wipe out other debts such as car payments, school loans, or credit card bills and pay for basic final expenses like burial/crematory costs or medical bills left for the estate. Life insurance is tax-free CASH when it is needed most so people can mourn without thinking about money problems, and ultimately help them to get on with their lives.
We are here to help responsible people who love someone or others, and who have come to grips with their own mortality, acknowledging that no one lives forever. They are happy to pay life insurance premiums to have their loved ones financially protected. They have a sense of urgency and realize they cannot afford to procrastinate and put it off till it's too late, either dying without enough life insurance in place, or having their health change making them no longer insurable, or at the very least "rated" causing it to be much more expensive. Our ideal life insurance clients WANT to buy life insurance and feel their loved ones are worth protecting. They need no convincing. They simply want our guidance and coaching on finding the most appropriate life insurance solution for their situation. If this sounds like you, give us a call. We'll probably make a good fit.
Regardless of which policy you go with, you may want to seriously consider getting one with an "Accelerated Death Benefit Rider," or "Terminal Illness Rider." These riders allow you to invade, i.e. use a portion or all of the death benefit while you are alive if you become terminally ill, or end up needing long term care. We like to think of it as an opportunity to fill your "bucket list" before it's too late. What if your doctor told you, you were terminally ill, would die in the next two years, and if there was anything you wanted to see or do, you better do it in the next 6-9 months while you have the chance. Sure, maybe you'd like to take your whole family on a two week skiing trip to Switzerland, or one of those over-the-water bungalows in Tahiti, but how would you pay for it? Maybe you just want as much time with loved ones as possible and want to buy them some time to spend with you. Whatever is on YOUR bucket list, you will need CASH. These riders only charge a small nominal fee at the time you exercise them. You may not even want to use them, but it can be nice knowing it's an option.
Term Life Insurance is the simplest, least expensive type of policy to start. It's great when you have a need for a lot of protection and you're on a tight budget. It is generally for temporary needs, such as paying off a mortgage, or protecting children when they are at home. It coves a temporary period of time, where the premium costs are fixed, locked-in for that period of time, such as 10,15,20, or 30 years. They can be set to renew, (guaranteed renewable) at the end of the term, but the cost will be horrendously more expensive. The only people who usually exercise this are those who are terminal. Term insurance is extremely cheap. A healthy 35 year old male can buy a million dollars of 20 year term for about $60 per month, on average, depending on the policy and company. If you are healthy, and you love someone, there is simply no excuse to not at least have some Term life insurance. The risk you are running with term life insurance, if you say buy a 20 year term, is if you still end up having a need for life insurance at the end of the 20 years. You will be older so it will be more expensive, and if your health has changed, you may no longer qualify. Tell us when you are going to die, and we will tell you what kind of policy you should buy so it will be in force when you need it. One thing to keep in mind with Term Life, is if you miss your monthly premium, there is only a 30 day grace period. After that, your policy is lapsed and won't pay. If this sounds like a problem, read more on your other options, such as Universal Life, or Indexed Universal Life.
Universal Life is a type of "Permanent Life Insurance," that is known for its FLEXIBILITY. More on that later. Some people do not like the idea with Term Life Insurance, that the term of time may not last long enough. It bothers them that they could have a 15 year term life policy, have it run out, no longer qualify to get more life insurance and die in the 16th year. To address this, these buyers select a policy with a permanent death benefit, made to last as long as they do, typically to age 90, 95, 100, or literally forever, age 120. In the old days, "Whole Life" was the only option to do this. However, whole life insurance was also very expensive because it has a cash value component, that builds up a savings, and equity - it's not an option. Many people however, are not interested in this cash value. They do not want to use life insurance as a savings tool, an investment. They simply want a life insurance policy with a permanent, long-term death benefit, that doesn't run out like term life, and they want it at the lowest possible cost. Universal Life is perfect for this scenario and we broker with top "A" rated companies to help you find the right one. People also like Universal Life because it can have a very flexible premium structure. You can skip payments, reduce payments, pay more to play catch-up. Unlike Term Life policies, which only have a 30 day grace period, these policies can have a small reserve, a savings, a surplus built up that is used to keep a policy in force, from lapsing. To many people, this feature alone, is worth the price of admission.
INDEXED Universal Life Insurance has all the same benefits of Universal Life insurance, with the added benefit that it can be a very powerful and fantastic accumulation tool to save money for retirement, as well as emergencies and opportunities along the way. These policies, besides having a long-term tax-free death benefit, and flexible premiums, also can create substantial cash value. Unlike Whole Life policies, which are extremely conservative, and only grow at 3-4%, and which are based on government bonds, Indexed Universal Life policies cash value growth are based on the UPSIDE gains of stock indexes such as the S&P 500, BUT without ANY of the downside market risk and volatility. Gains earned each year are "locked-in" so your values can't go down, even if the market does. Unlike real estate, stocks, bonds, mutual funds, and 401Ks, new gains recovering from a down market START from the last "locked-in" position, NOT from the bottom - just trying to play "catch up." These policies also have very unique tax advantages that allow the cash values to grow on a tax-deferred basis, but can be distributed TAX-FREE at retirement, or anywhere else along the way; There is NO 10% IRS penalty for withdrawals taken before the age of 59 1/2. Also, what if you get totally disabled? With 401Ks and other investments, your contributions will come to a screeching halt. These policies can have a disability feature, essentially premium insurance, so that your payments are made for you, with no taxable event, so your retirement plan doesn't implode simply because you are sick or hurt and can no longer afford to fund it. These policies are also allow huge premiums if you are really wanting to sock away a lot of money, unlike IRAs, Roth IRAs and 401ks. If you can swing it, and are serious about putting away money for retirement, these policies can be the ultimate savings tool for the right person.
Watch widow and mom, Alyssa Taber share how she feels about life insurance. Better have a Kleenex handy.
Check out this great video about the VALUE of life insurance - and why people buy it
Learn about life insurance protection combined with Indexed Savings by Columbus Life
Another great video by Principal Life on Indexed Universal Life
Check out this great video on ACCELERATED Death Benefits by Columbus Life