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AreYouInsured?
ToomanyAmericanshavenolifeinsurance.Theirlovedonesmaypaydearlyforthatchoice.
ProvidedbyKeithWBerg&AdamGood
SeptemberisNationalLifeInsuranceAwarenessMonth–agoodtimetothinkaboutthevalueandimportanceofinsuringyourself.AccordingtoarecentBankratesurvey,42%ofAmericanshavenolifeinsuranceatall.Theymaynotknowthatlifeinsurancecoveragehasbecomemuchmoreaffordablethanitoncewas.1Manypeopleaskiflifeinsuranceisreallyworththecost;maybeyouareamongthem.Thesimpleanswertothatquestionisyes.Itcanbestunninglycheap:ahealthy,non-smokingmaninhisthirtiesmaypaylessthan$45amonthfora$1million20-yeartermpolicy.Permanentlifeinsurancecostsmorethantermlifeinsurance,butpermanentlifepoliciescanbuildcashvalueovertime;termpoliciescannot.2Lifeinsuranceisaboutmanagingrisk,andifotherpeoplerelyonyoufinancially,youneedtohaveitinplaceincaseyourpassingputsthematfinancialrisk.Whenaspouseorparentdies,therearefinancialmatterstoaddress:asuddenlackofincomeforahousehold,billsandmortgagesorrenttopay,finalexpensessuchasfuneralorcremationcosts,andthecostofchildren’seducation.Withoutadequatelifeinsurancecoverage,ahouseholdishard-pressedtomeettheseimmediate,financiallydrainingchallenges.Manygrowingfamilieshaveinadequatelifeinsurancecoverage.TheBankratesurveydiscoveredthat37%ofparentswithchildrenunderage18hadnopolicyatall.Someyoungerfamiliesfindcoveragethroughgroupplans,butperhapsnotenough:32%ofthesurveyrespondentsraisingminorchildrensaidthatthedeathbenefitsontheirlifeinsurancecontractswere$100,000orless.1Theproblemofinadequatecoverageseemstoplaguehouseholdsofallages.Afive-figurelifeinsurancepayoutcanpayforafuneral,butitwillnotoffermucheconomicinsulationtoafamilyafterawageearnerdies.Bankratefoundthat47%oftheAmericanswhohavelifeinsurancehavepolicieswithcoverageamountsof$100,000orlower.Twenty-onepercentofAmericanshavepolicieswithdeathbenefitsof$25,000orlower.1Howmuchcoverageisadequateforyou?Ideally,youshoulddeterminethatwiththehelpofaninsuranceprofessional.Asaroughruleofthumb,thedeathbenefitonapolicyshouldbeabout15timesyourincome.Ifyouareconsideringatermlifepolicy,thetermshouldnotendbeforeyourenvisionedretirementage.2
ThismaterialwaspreparedbyMarketingPro,Inc.,anddoesnotnecessarilyrepresenttheviewsofthepresentingparty,northeiraffiliates.Thisinformationhasbeenderivedfromsourcesbelievedtobeaccurate.Pleasenote-investinginvolvesrisk,andpastperformanceisnoguaranteeoffutureresults.Thepublisherisnotengagedinrenderinglegal,accountingorotherprofessionalservices.Ifassistanceisneeded,thereaderisadvisedtoengagetheservicesofacompetentprofessional.Thisinformationshouldnotbeconstruedasinvestment,taxorlegaladviceandmaynotbereliedonforthepurposeofavoidinganyFederaltaxpenalty.Thisisneitherasolicitationnorrecommendationtopurchaseorsellanyinvestmentorinsuranceproductorservice,andshouldnotberelieduponassuch.Allindicesareunmanagedandarenotillustrativeofanyparticularinvestment.Securities, advisory services and insurance products offered through Investment Centers of America, Inc. (ICA), member FINRA, SIPC, aRegisteredInvestmentAdvisorandaffiliatedinsuranceagency.
Lifeinsurancecanalsobevaluablewhileyouarealive.Apolicywithcashvaluecomponentsmaygrowovertime.Afterawhile,youmaybeabletoborrowagainstthecashvalue.Sometimesthepayoutamountonthesetypesofpoliciescanbeadjustedaswellasthesizeofthepremiums.Ofcourse,youmustkeeppayingthepremiumstokeepanykindofpermanentlifeortermlifepolicyinforce.3Whileyoumaydecideyoupreferonekindofpolicyoveranother,theimportantthingistohavecoverageinplace–notjusttoreassureyourself,butthoseyoulove.Lifeinsurancecanhelpaspouseorafamilymaintainfinancialequilibriumatatimewhenitismostneeded.Citations.1-bankrate.com/finance/insurance/money-pulse-0715.aspx[7/8/15]2-forbes.com/sites/timmaurer/2016/01/05/10-things-you-absolutely-need-to-know-about-life-insurance/[1/5/16]3-nerdwallet.com/blog/insurance/should-you-consider-cash-value-life-insurance/[5/6/15]
RegisteredRepresentativesKeithW.Berg,CFS,MSFS
www.icaiowa.com
