If you’re anything like me, you’ll do whatever it takes to save money. Which is smart, it is always good to have savings for a rainy day. However, there’s one thing many people are waiting to buy, and it could really cost you. Below you will find reasons you should not delay purchasing life insurance:
1. The younger you are, the cheaper it is. Life insurance uses mortality tables based on age to determine your rate. Every year you wait, you’re just making your future premiums more expensive.
2. Get it now while you’re healthy. Preexisting conditions can make life insurance expensive, but if you get the policy while you’re still healthy you’ll be happy with how little you have to pay for peace of mind.
3. The future is unpredictable! If you had complete control of everything, life insurance would be useless, but that just isn’t the case. In this uncertain world life insurance might be the only thing able to take care of your family and final expenses if something awful were to happen.
4. It’s better to have it and not need it, than to need it and not have it. I’ve never met a family who used life insurance and then wished they didn’t have it. It’s similar to auto insurance; you buy it, and hope you never need it.
5. It will accrue more interest than any savings account or bond you might purchase. If you get it when you’re young it could easily become your retirement! Why keep your money in the bank where it won’t grow more than a few dollars?
“It’s better to be a few days early than a day late.”
by Dylan Delhart, Financial Advisor @ insureCAL Insurance Agency
The biggest problem I’ve noticed in the insurance industry is people want life insurance, but with all of the variables and unexpected costs, they have no idea how much coverage they actually need. Having the correct amount of coverage is extremely important. With not enough coverage you could leave your family in debt, and with too much coverage you’ll be paying too much of your hard earned money on monthly premiums! That’s why with help from our friends at Nationwide, I’ve created an easy way for you to calculate exactly how much coverage you and your family needs.
Let’s use Jane Smith as an example. She’s a single mother with a 13-year-old daughter named Sara.
- Jane has a mortgage on her home and she still owes $180,000.
- She makes $40,000 a year, and if something were to happen to her, she wants her daughter to have half of her yearly income for the next 5 years. $80,000 divided by 2 multiplied by 5 years = $100,000.
- Sara dreams of going to college in California, and Jane wants to make sure if she’s not around to pay tuition Sara can still go to college. Let’s assume that tuition will continue to steadily rise and when Sara goes to college it will cost $30,000 a year. $30,000 a year for 4 years = $120,000.
- Jane has $4,500 in credit card debt that she does not want to leave behind for Sara to have to deal with.
- Jane wants to leave Sara an emergency fund for unexpected expenses such as a new roof for the house or new engine for the car. Experts suggest 3 months of income for your emergency fund. $40,000 divided by 12 multiplied by 3 = $10,000.
- Jane also wants her funeral to be paid for by her life insurance. The average cost of a funeral is just over $8,000 let’s round it to $9,000 to be safe.
Now we’ll add all of this up to determine her family’s need which = $423,500
Now we’ll subtract her assets from the total to determine how much of her family’s need is not covered.
- Jane has a life insurance policy through her job which is worth $100,000.
- Jane also has $11,000 in her savings account.
$423,500 – $111,000 = $312,500
Now we have done all of the math and we know Jane needs a $312,500 life insurance policy to fully protect her family. Of course not many people want to do all of this math for themselves, so that’s where I come in! I’m more than happy to sit down with anyone and go over their finances to make sure their family is protected. If you have any questions or concerns give me a call today: (209)410-0270.
by Dylan Delhart, Financial Advisor @ insureCAL Insurance Agency
Everyone knows that life insurance will pay out a benefit when the insured passes on, but most people don’t know the other benefits of having life insurance. One of the greatest things about life insurance is the ability to borrow money from the policy.
Foster Farms Everyone knows and loves Foster Farms chicken, but did you know that Max and Verda Foster payed for their first farm with money borrowed from a life insurance policy? In 1939 the Fosters borrowed $1,000 from their life insurance to purchase 80 acres of land in Modesto and began raising chickens. This investment led to the creation of Foster Farms.
JC Penney James Penney incorporated his clothing store in 1913, 16 years before the great depression. When the depression struck it destroyed his wealth and almost ended his franchise. He was able to borrow from his Life insurance policy to pay his employees and keep his business afloat. Had he not had life insurance we most likely would not be able to shop at JC Penney today.
McDonald’s Ray Krok bought out the McDonald’s brothers and took over the franchise in 1961. During the early years of the company he constantly had cash shortages. On 2 occasions he had to borrow money from his life insurance to cover the salaries of employees.
Disneyland Walt Disney had a dream to create a nice clean amusement park where families could come together and enjoy themselves. He was unable to get the financing he needed to open Disneyland, so he decided to finance it himself. Most of the money used to create the first Disneyland came from the cash value of his life insurance policy. If Walt had not had life insurance, Disneyland may have never been built.
by Dylan Delhart, Financial Advisor @insureCAL
Positive employees make for a positive business. So, how can you ensure your employees start each Monday with a positive foot forward? Offer them peace of mind. In an increasingly hectic world, you can’t put a price on peace of mind, and it’s even harder to achieve. However, you can ensure peace of mind in your employees with something as simple and cheap as offering life insurance. So, why should you offer life insurance to your employees?
- Your employees want it! According to recent surveys within the private sector 97% of employees offered Life insurance choose to enroll.
- Less payroll and income taxes. If all the requirements are met, the cost of the premiums for the first $50,000 of group-term life insurance isn’t included in the employee’s gross income.
- Employee retention. Employees with quality life insurance are less likely to take seasonal jobs or leave the company altogether, saving the employer turnover expenses.
- Increased morale. For many workers, good benefits are the difference between a job and a career. Employees with life insurance generally feel more essential to their workplace and may feel the desire to go above and beyond expectations.
- More appealing job offers. Any employer will tell you how important good employees are. Quality employees are hard to come by these days. By simply offering life insurance, your business can compete with the power houses for the best employees.
- You could be a hero. The difficulties surrounding the death of their primary wage earner oftentimes extend beyond the initial mourning and emotional distress of the death. Without life insurance the family could be subject to serious financial hardships. The monthly premiums are minuscule compared to the immense benefits. Although no amount of money could replace a loved one, it’s much easier to recover emotionally when you’re not worried about coming up with thousands of dollars for funeral expenses.
- It’s inexpensive. Term life insurance costs less than your daily cup of coffee! If someone could offer you peace of mind for a price that low, wouldn’t you be interested? Life insurance is one of the cheapest forms of insurance to purchase, which is marvelous considering how important it is.
- It’s easy to get! Many employers are intimidated by the amount of paperwork involved with getting life insurance. While the hassle may seem daunting, our life insurance professionals are prepared to streamline the process and take care of the tedious tasks that surround getting enrolled in a life insurance program.
- Increased productivity. A recent study by economists at Warwick University, discovered that happy employees saw an increase in productivity of 12%, while unhappy workers were 10% less productive. The happier, more appreciated your employees feel, the more inclined they will be to bring that positive attitude to work with them. Every employer knows that both positivity and negativity are infectious in the workplace. By offering life insurance, you’re contributing to a more positive work environment because every employee knows that happiness in the workplace starts with their employer.
Contact Dylan Delhart at InsureCAL to talk about the best life insurance options for your employees.
by Dylan Delhart and Patrick Ramsay