AFFORDABLE PERMANENT LIFE INSURANCE

Affordable Permanent Life Insurance

Why Affordable Permanent Life Insurance?

Most people, when searching for life insurance, choose Term Life Insurance. Why? Because it is the least expensive form of life insurance. Actually it is quite affordable, and it does the job. Meaning, it provides financial protection for the family in the event that the main breadwinner all of a sudden dies.

However, if cost was not an issue, in other words, if the cost of term and permanent insurance were the same, which it is not, or if the person did not have to adhere to a budget that puts a cap on how much he/she can spend on life insurance, we all would choose permanent life insurance over term life insurance. Obviously.

So, if there were some form of permanent life insurance out  there that was somewhat affordable, we all would probably go for it to address the financial risks in our lives.

Do You Really Need Life Insurance?

Before we talk about the choices there are of life insurance, lets talk about why do we need life insurance to begin with. What does life insurance brings to our family life that is worth spending money on?

Have you ever thought what would happen to your loved ones if all of a sudden you died and were no longer able to provide financial support to your spouse and children? Who would pay for the mortgage, health insurance, food, utilities, education, etc.? Life insurance provides the funds needed so that your family may continue to function in the manner they were accustomed if you are no longer able to provide. And life insurance proceeds are generally tax free to the beneficiary. Some people discount the importance of life insurance and simply refer to it as something I spend money on the benefits of which are available only when I die. But what about your family? How would they get by? Please, take a look at this video and then come back to this page.

A Legacy of Love

I Can’t Afford Life Insurance!

Other folks think that life insurance is expensive and they cannot afford it.  It is not so. Term Life Insurance is affordable and does the job of providing the financial security needed by a family. Let’s look at some recent Term Life Insurance quotes for maturities of 10, 20 and 30 years.

Looking at the above worksheet, do you agree that Term Life Insurance can be affordable?

How Much Life Insurance Do You Need?

The answer to this question is sort of a moving target. It depends on each person or family. Most folks purchase life insurance on the assumption that by the time they retire they will have paid the mortgage and all other significant debt; the kids will be on their own, financially and otherwise; they will have their traditional retirement account from the job, whether a 401k, a pension plan, or some other form of retirement account; they will be selling the “big house” and move to an apartment, etc. The point being that by the time they retire they will have little debt and their financial responsibilities will have gone down significantly. This assumption does not always hold, but it is a good way to start the process of determining how much life insurance one needs.

Therefore, what we recommend our clients is that in fact they purchase Term Life Insurance to mature around the time they retire, to take care of significant financial obligations, and then purchase a Permanent Policy in the form of Guaranteed Universal Life Insurance (GUL) to take care of final expenses. Usually $100,000 of GUL insurance will do it. 

Why is it important to buy some permanent life insurance as soon as possible. We see a lot of folks that when they reach the late 60’s or early 70’s, they still have some debt outstanding and final expenses to pay. Then they start looking for final expense life insurance which is very expensive. And if their health has deteriorated, they may have to opt for Guaranteed Life Insurance (totally different than Guaranteed Universal Life insurance). Guaranteed Life Insurance is even more expensive than Final Expense insurance. So the prudent thing to do is to get some (again, unless circumstances dictate otherwise, $100,000 should do it) permanent life insurance early in life while we are healthy and young.

About Permanent Life Insurance

We already covered above that Term Life Insurance is an economical way to provide financial security to the family in the event that the main breadwinner were to die unexpectedly.

Now we want to make the point that, unless you have a lot of money, can afford to make large premium payments and is able to benefit from the estate planning and tax-related benefits that Whole Life Insurance brings to the table, GUL is that way to go for affordable permanent life insurance. Let’s look at the following comparison:

As you can see from the above chart GUL premiums are not only cheaper than Whole Life premiums, but they also come in a variety of maturities. You can actually select the maturity that best fits your situation. Also, in some cases, you can make payments up until a certain age, such as 65. One of the advantages of GUL policies is their flexibility, as you can see in this example. If you would like a quote on a GUL policy, please GUL QUOTE

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