Yes....Life insurance can be confusing.....and it's not your fault!...Many advisors today only do insurance part time....(at INCOME RESOURCE GROUP we've been helping our clients make good life insurance choices for over 40 years)......I certainly wouldn't take medical advice from a doctor who only practiced medicine part time....
So let's see if we can provide some clarity.....Life insurance is simple replacement of income at time that cannot be predicted....someone dies....their income stops... if a family or business relied on that income they find themselves in a bad situation if little or no life insurance was there.....so let's do some simple planning...
How much life insurance do I need? There are a number of accepted formulas to calculate the amount...but for this brief discussion....let's do this..
Your earn $75,000 a year ....if you are 40...you will earn $1,875,000 to age 65.....not figuring any raises...your earning potential is quite substantial.....so...we need to ask ourselves this question..."How many years of my income do I want to leave my family? or business"....a general rule is 7-10 times my earnings....so let's take the low side....,7 times my income ...$525,000. Next..do you have a mortgage? Do you want it paid off ? OK....your mortgage is $200,000....so we add that and come up with a simple need of $725,000 of death benefit.......(did you know that life insurance death benefits are INCOME TAX FREE?)...we can factor in other income...inflation rates...etc.....but it does not have to be complicated or intimidating.......and under no circumstance should you pay a fee for this advice....at INCOME RESOURCE GROUP we are 100% non-fee based.
As to what kind of life insurance to use....there are several types......basically in 2 major categories...TERM and PERMANENT......depending on your specific needs....and we determine that together.....often we use a combination of both types together...as they both have merit if used properly...
I would say that if you have questions.....want a review.....or a second opinion (no one has an exclusive on all the good ideas)....give INCOME RESOURCE GROUP a call......(908)419-5170.....or send in a request....info@incomeresourcegroup.com
We'll be happy to help.....and there is no obligation........