Term vs. Permanent Life Insurance

Term vs. Permanent Life Insurance

Less than half of middle income earners age 25 to 64 own individual life insurance, according to LIMRA, which keeps close tabs on the life insurance industry.

In the same survey, 44% of those who didn’t have it, said they needed it.

When considering life insurance, one of the most important factors to understand is the difference between term and permanent insurance. Here’s an inside look at both.

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Make Sure That You’re Covered Long-Term

We’ve all heard the horror stories about the investor who did everything right, who had the right job, maxed out their 401k, diversified their portfolio until comfort in retirement was assured, only to have the rug swept out by a debilitating illness. For this exact reason, insurance companies have created a product called long-term-care insurance. Since Medicare doesn’t pay for most nursing home costs, and Medicaid doesn’t ante up until your assets are almost depleted, investors who have wealth that they want to pass on to loved ones need to protect it. Long-term-care policies do just that, In fact, many insurance agents will tell you that as you near retirement age, long-term-care insurance becomes a real priority. That priority was much easier to satisfy before the policies became losers for the insurance companies, leading insurers like Manulife Financial to ask state regulators for average rate increases of 40%, and other insurers like MetLife, to stop selling new policies entirely.

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Eating the Estate Planning Elephant... One Bite at a Time, Part I

No one wants to look at it, no one even wants to think about it, yet there it looms — the giant estate planning elephant in the room. It's impossible to coexist happily, so you know you'll have to tackle the beast at some point, and when it comes to your financial well-being, earlier is always better than later.  
So what's holding you back? Many Americans mistakenly believe estate plans are only for millionaires, but many more are simply threatened by the perceived scope and difficulty of such a goal.  

 

Spend a weekend doing a household walkthrough as well as a walkabout of any property beyond the walls of your home, ticking off and logging assets as you go.

 

Estate planning is a serious endeavor, so it's not uncommon for people to use their perception of estate planning as a long, difficult, tedious and time-consuming process as an excuse to procrastinate. But there's no need to stall along the path to reaching your estate planning goals, especially if you break the process down into simple, easy-to-manage tasks. And after all, isn’t that the best way to eat an elephant? Take it one bite at a time, and before you know it, you'll have a solid estate plan in place — not to mention the peace of mind that comes along with it.

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