Life Insurance
Everyone who is working for a living and has someone that depends on them financially or who wishes to leave something behind to cover the costs of their funeral arrangements needs life insurance.
Personally, I had a wife and three children, a mortgage to pay, a need to save for their college and our retirement. If I died in an accident or through illness, my family would have been in serious financial trouble.
Life insurance is most affordable when we are young, the premium can almost be unnoticeable. I paid mine by automatic payment for the last twenty-two years. My children are all independent now, so my main concern is for my wife to be taken care of should I pass away earlier than my life expectancy.
Life insurance is sold in many different forms or types. The following are the primary types, but this is surely not a complete list.
Term Life
Term life is the least expensive type of life insurance. You determine the amount of coverage you want, how long you want to be covered, and you pay a fixed premium generally monthly based on your age and other factors.
Whole Life
Like Term Insurance, Whole Life also has a fixed premium payment and a fixed face value (death benefit). Unlike Term Life it has cash value that grows at a fixed guaranteed rate of return.
Universal Life
Universal Life is similar to whole life except it allows more flexibility. For example, you may adjust the premium you pay up or down as well as the death benefit depending on the changing situation of your life.
Fixed Index Universal Life
Fixed Index Universal Life is Universal Life with the added capability for you to allocate all or a percentage of your cash value to grow in relation to an index such as the SP500 for example. There are pros and cons and life insurance should never be purchased as an investment. However, you may think the fixed interest rate on a Whole Life or Universal Life policy is low and the stock market has upside potential. At the same time you don’t want to risk losing any of your hard earned money should the market decline. With Fixed Index Universal Life, you will only receive a percentage of the upside which of course can be more than the fixed guaranteed interest which is great. However, should the market decline you may not receive any interest during the years the market declines. The good news is that you can never lose money. Even if the market sharply declines, your cash value is safe and may even go up a bit if your policy comes with a guaranteed minimum interest or you kept some of your cash value growing at the fixed rate.
Variable and Variable Universal Life
Variable polices are not sold by insurance agents. One must hold a series 6 or (7) and a series 63 license. Variable policies were developed to outpace inflation based on investment market increases over time; however, they are the highest risk and highest cost. You can choose from a variety of investments to allocate your cash value. The downside is you can lose money when the investment vehicles you choose decline.
Final Expense Insurance
Many people I speak to are completely unprepared for an untimely death, they have no funds set aside even for their own funeral expenses. This leaves their loved ones with the burden and debt of covering those expenses. Final Expense Insurance is a product sold to help people in such a tough situation. It also is a way to leave something behind for them to enjoy in your memory.
I offer a wide-variety of life insurance products. I can generate a quote for you in a few minutes. Just give me a call or contact me via this website.
Don Nasca
503-703-0208