Will Your Family Experience Financial Chaos in the Event of a Pre-Mature Death?
2 weeks before I was married, I had Cheri come up to the office. It was probably the least fun thing of an exciting time. I had my attorney meet us in the conference room to sign wills and then make sure that everything was taken care of as we started our new life together. Life insurance became real after we moved into our first house together and had our first son all within a year's time frame.
Being a financial advisor, I never understood why people put this process off. At the same time, I have appreciated the complicated nature of the process. If you aren't where you want to be health wise, that quickly comes into the picture. Maybe you don't want to face losing weight or getting a health condition under control. Maybe you don't want to quit some bad habits or face that probability. Maybe you don't want to face your own mortality. Maybe you don't want the extra bill right now.
So, it is easy to put it off and ignore the problem at hand. However small the probability of a pre-mature death might be, it is a probability. I would suggest that the probability has even grown considering the escalation of violence in the world.
Take the recent bizarre and tragic story of the off duty Dallas police officer who after getting off of work walked into the wrong apartment and shot and killed someone who she thought was an intruder....the deceased was in their home minding their own business.
The question is really simple. If you or your wife died prematurely, what would the financial effect be on your surviving family?
Well, I am bringing it up because September is Life Insurance Awareness Month. USAA sent out these statistics:
2018 Industry Data finds that Approximately 50 million Households Recognize They Need More Life Insurance and If a Primary Earner Died 35% of Households Would Have Trouble Paying Expenses Within a Month. One of the most alarming LIMRA findings, 1 in 3 U.S. households would have immediate trouble covering living expenses with the loss of a primary wage earner and almost half would feel the impact within six months.
This is completely avoidable. Term insurance is cheap and you can buy a lot of it. You are wanting to cover the basics:
- Replacement of an income
- Pay-off any debt
- Pay for college expenses
- Fund any special needs situations
Those are the basics. Maybe all four of the above are important to you. Maybe just a few of those items are important. It comes down to you and your spouse's values. The key is getting with a financial advisor who will spend the time to craft out an insurance plan for you that covers what is most important to you without breaking the bank.
Don't put off today what can take care of what you might not be around to experience tomorrow with your family!
Bob Brooks is host of the Prudent Money Radio Show. For more information and resources like Ask Bob, you can go to www.prudentmoneyradio.com. If you want to inquire about his financial advisement services, email him at firstname.lastname@example.org call 972-386-0384 and ask for Judy.