Beware Of Your Term Insurance -- THE TICKING TIME BOMB!
WHAT KIND OF INSURANCE IS BEST FOR ME?
If you’ve read any of our other reports, you’ll know that even though insurance has been part of our culture for over 100 years, to most people – It’s still just a mystery. And because they don’t understand it, a lot of people think they’re being “ripped off” by the Insurance Industry; aka “The Club”
I want to end that for you.
I’ve been inside the insurance business for over 30 years and I know it like the back of my hand: From policy to claims and back again.
I've sold insurance. I've studied it. I've discovered what makes "good insurance" -- and what makes "bad insurance".
I know that not all insurance is "created equal". Life insurance is certainly no exception. Placing all your coverage in TERM LIFE INSURANCE can be one of the costliest mistakes you could make.
To help us get started, please answer this question for yourself:
WHEN DO I WANT MY LIFE INSURANCE TO BE IN FORCE?
(IN FORCE means that it’s paid, current and ready to pay a death benefit if you should die. )
Well, the obvious answer is: WHEN I DIE!! Of course…
OK, when do you plan to die????
The next obvious answer (at least MY answer is) When I’m old.
VERY OLD.
THE OLDER, THE BETTER!
Let’s face it. You purchase life insurance really hoping that you’re NOT going to use it any time soon. And you know what? Odds are that you probably won’t. Most likely you’re going to die when you’re older – Much older. But just in case you don’t, you purchase life insurance to protect the financial future of those you love.
So let’s look at the facts of term life insurance. Nothing emotional or prejudged – Kind of like an FBI agent just examining the evidence to see where it leads.
Here’s what Term Life Insurance life rates look like. This is just a typical example for a $100,000 5 year Term Policy, Male, non-tobacco rates. You can get different rates from a hundred different companies. What will be the SAME from ALL THE COMPANIES is the UPWARD TREND of the rates.
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FACT #1 – Term life insurance is not very expensive when you are young. Notice how the rate doesn’t even change for the first 3 years.
FACT #2 – Term life insurance premiums increase as you get older. Take a look at the chart. Except for the first few years, the rate increases EVERY YEAR.
FACT #3 – Term life insurance gets VERY EXPENSIVE when you’re older. Notice how it increases VERY SLOWLY until about age 50 when it really starts to take off.
FACT #4 – The premiums you pay for term life insurance never come back to you. You see term insurance is kind of like renting an apartment. Certainly cheaper every month than buying a house, but when you leave you leave all your hard earned money with your landlord.
FACT #5 – At some point in time, you’ll look at your monthly premium for your term life insurance and say, “I just can’t afford this any longer.” It usually happens just about the time you retire and your income is going down a little and the cost of your life insurance is rocketing through the roof! Check the premium at AGE 71… WOW!
Could be a problem, don’t you think?
At age 71 you may not need the insurance any longer. But let’s just say that you do. Maybe the house isn’t quite paid for, there’s some money you’d like to leave to family, grandkids, spouse, your church… could be a hundred different reasons. The problem is that if you want to keep your insurance, you probably can’t because it’s just become too expensive for you.
Wouldn’t you like to have the option to keep it or not?
Let me show you how you can have that choice then by making a simple decision today.
Get a small permanent life insurance policy today that will give you options when you are older.
Here’s what permanent insurance can do for you.
1. Provides you with insurance you can keep for the rest of your life.
2. NEVER increases in premium.
3. Usually allows you to stop paying the premiums just about the time you retire and REMAIN INSURED FOR THE REST OF YOUR LIFE.
4. Sometimes you can even have the policy PAY YOU a monthly income.
(I’ll include a few more for you at the end of this section…. Look or this little guy again. ---------------------->
Remember -- Odds are you’re going to live and your term insurance isn’t going to pay a death benefit for you. But it fills a need when you’re young. Generally in your younger years 30-55, your financial responsibilities are high. You have kids, house payments, extra cars, college to pay for, on and on and on…
Usually, when you hit 55-60 or so, those obligations are MUCH LESS! You don’t need the amount of life insurance you needed when you were younger. The kids are out of the house, you have fewer cars to “support”, college is done, the house is paid for (or nearly so…).
BUT…. There will still be expenses to handle when you die – Funeral, maybe some small debts to pay off, or possibly you need to provide an income for your spouse at the loss of you retirement income.
The cheapest way to pay those expenses is ALWAYS WITH SOME LIFE INSURANCE. Much cheaper than drawing money out of the savings account.
But here’s the problem with that…
If you need $500,000 of insurance coverage today because your obligations are still in the fast lane, you probably can’t really afford to buy all of your life insurance as PERMANENT insurance.
$500,000 or permanent insurance would cost you at least $300-$400 per month.
And here’s the answer….
Life insurance is the ONLY kind of insurance you buy where you’re GUARANTEED to make a claim. Your term insurance may or may not be in force when you die. Your permanent insurance will be.
And here’s the real rub! Even if you decide to pay the additional premiums, TERM insurance is usually only renewable to a certain age. You may live longer than the policy can be renewed
Here’s some more benefits of permanent insurance if you choose UNIVERSAL LIFE as your policy:
5. Your earnings are TAX DEFERRED which means Uncle Sam actually is helping you pay your insurance prem
iums.
6. Your policy PREMIUMS are flexible which means that if you hit a period of financial hardship you can actually STOP PAYING for a short period of time and continue to be insured.
7. You can adjust the amount of your coverage up and down depending on your changing needs. (you’ll need to be insurable of course to increase the coverage unless you’ve planned ahead by adding GIO to your policy. Good to get, but too much to explain here. Ask me when I see you.)
Get the numbers on your own permanent insurance plan and just look at 'em. (that's FREE for Pete's Sake) For just the price of a Starbucks a day OR LESS, you can have the peace of mind that comes with owning a permanent insurance plan that can make your life so much easier when you are older.
NO obligation, no pressure, just take a look then decide.
So here's a couple of help questions for you:
- 1. Do I want some life insurance in force when I die? (probably yes)
- 2. What's my best guess of when that will be? (let's say you guess 78)
- 3. How much life insurance do I want in place at that time?
Whatever your answer is for question #3, THAT'S how much permanent life insurance you should have. Consider term insurance to fill the rest of your (temporary) needs.
If you have any questions, just give me a call 619-670-1000 or drop me an email to Dennis@DennisVolz.com
(if you'd like to look at your numbers,)
I just need to know three things:
1. Your age
2. If you want $50,000, $75,000, or $100,000 or permanent insurance (you can choose any amount above $50,000 of course, but most choose one of those three.)
3. Do you use tobacco in any form?
I’ll email you an illustration of your policy and then let you decide.
It just doesn’t get any better -
OR EASIER - than that…
You’ve got everything to gain and NOTHING to lose.
Dennis Volz Insurance Agency
10783 Jamacha Bl, Suite 1, Spring Valley, CA 91978
OFFICE: (619) 670-1000 - FAX: (619) 670-1121
eMail:Dennis@DennisVolzInsurance.com
Websites: Company Site: DennisVolzInsurance.com
Client Convenience Site: 6701000.com
My 'Other Blogs'
Working by Referral
Musings from California
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