The Power of Life Insurance to Meet your Family’s Goals

On this episode of A Wiser Retirement Podcast, Casey Smith, and Randy Hargett, CLTC, discuss the power of life insurance to meet your family’s goals.

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SUMMARY:

Options for Life Insurance

Being intentional with our finances includes protecting our family through having life insurance. It’s essential to prepare ourselves and the ones we love for the downsides of life as well as the upsides. If you are on a great trajectory, but suddenly pass away, it’s important to make sure that your family will be taken care of.

Life insurance can, in a way, be compared to other insurances that we hold throughout a lifetime. For instance, car insurance or home insurance. Our car insurance changes every time we buy a new car. Our home insurance changes every time we move to a different house. Equally, every time a major life event happens or a life season changes, life insurance changes, too. Consequently, life insurance evolves over time. 

2 Types of Life Insurance:

Term Life Insurance 

To understand Term life insurance, you can ask the question, what needs to be taken care of if I died today?” So, for example, “If I die now, what are the needs that my family has that would have to be taken care of? Or, that I’d like to be taken care of?” You apply this to different seasons of life, and you can better understand what the needs are and what your life insurance policy should look like.

Permanent Life Insurance

Conversely, the permanent option is better understood by asking the question, “When I die…” There are different reasons why a family would choose permanent life insurance. One example would be, having a special needs child and knowing that the child’s needs go beyond your lifetime. 

Long-Term Care Insurance

Additionally, long-term care insurance is under the life insurance umbrella and is regulated like so. For a typical family, you don’t need to purchase a long-term care policy that’s going to cover all of your expenses if you do end up needing long-term care. When it comes to that, it is very likely that you’ll still have other sources of income, like social security and pensions, for example. The recommended approach then is to get a policy that supplements your retirement income, in case you need special care in your old age. 

Furthermore, people are starting to purchase long-term care policies earlier in life. 10 years ago, the average age when people bought long-term care policies was 62. Last year, 2022, the average age went down to 53. This is probably a smart decision since the ability to own a long-term care policy is also directly connected to outside factors, for example parents’ medical history.

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TIMESTAMPS:

8:45 Options for Life Insurance

10:28 Term Life Insurance

11:27 Permanent Life Insurance

16:28 Long-term Care Insurance

LINKS:

Learn more about Casey Smith, Brad Lyons, CFP®, and Missie Beach CFP®, CDFA®

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