Life Insurance
Life Insurance-what kind do you need? How much do you need? What company do you go through?
Keep in mind the purpose of life insurance:
- To replace your income, if you die-allowing your family to live without a significant change in life-style.
- To pay the costs of burying you.
- To help pay any bills or debts you may have.
Now your family is not responsible to pay debts that are just in your name. After the estate is settled if their is still money you owe, they are not legally required to pay them. But many families are bothered by that-and why not, if you owe the money-why should someone get stiffed-just because you are… (Sorry, couldn’t help it.) So having enough money to pay those bills is a good thing to do.
What type of insurance do you need?
- Term Life Insurance
- Term Life Insurance
- Term Life Insurance
Now, there are a lot of variations now, with whole life, universal life, universal variable life and other new versions, but they all have a savings plan, that has a low interest rate or growth rate. There are also high sales commissions associated with the policies, adding to your costs, but not to your benefits.
Salespeople argue that whole life type policies are the only way to get people to save money-not for “Millionaire Nurses”. The Millionaire Nurse understands the importance of setting up savings, and retirement plans, and don’t have to use overpriced and under-performing vehicles like a “life insurance” policy to do that for them.
How much life insurance do you need?
- If you are still in deep in debt, see if you have insurance at work, with your bank or credit union to pay for burial expenses-usually less than $15,000 worth of coverage-that is frequently free, or very inexpensive.
- When you debts are under control-then buy enough coverage so that your income can be replaced. If you need$40,000/year in income then at 4% payout per year, that would be close to a million bucks of insurance, if you didn’t want to touch the principle. Now, obviously if you draw down some of the principle over time, and increase your rate of return-you can get by with much less coverage.
- To simplify, many experts just say, buy 10-20 times your income in coverage.
- Once you are out of debt, have retirement savings in place, and have paid for your home, you can decrease or eliminate your insurance coverage.
Which life insurance company do you use?
Millionaire Nurses get the best price. How do you do this? By comparing prices with highly rated companies. (Don’t buy insurance from a company that is not rated highly with AM Best, Standard and Poors, or Moody. Get several quotes, and of course those who don’t smoke, and are taking care of themselves frequently get discounts-so stay healthy…
Another thing to remember is that “term” insurance means you are insuring yourself for a certain length of time. Some policies guarantee renewal at the end of the term-the rate will be higher but they will write you a policy. This can be important if you develop a chronic illness.
So, “Millionaire Nurses”, don’t have paralysis by analysis. Make an appointment with yourself soon- to study, and execute on buying your life insurance coverage, it is something “Millionaire Nurses” Do!
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