Do you really need Life Insurance?
Do you really need Life Insurance?
The short answer is “Yes!” if you love somebody.
“Something bad needs to happen for you to benefit from any insurance.”
~Common Misconception
This statement is the popular opinion, and nothing could be farther from the truth. A life insurance plan can be one of the most excellent wealth-creation tool for many people. Depending on how a plan is set up, it can provide many benefits unbeknownst to many because of stigma or general public perception about how insurance and life insurance, in particular, work.
Let’s talk about the benefits that a properly set-up life insurance policy can provide, regardless of where you are in life.
Infancy
Set up right, a life insurance plan can give a child their kickstart to having financial freedom early in life.
“Starting a life insurance plan can pave the way for your child’s education, first car, house, business, early retirement, and even a legacy for your grandchildren.”
It’s common to think that life insurance is only for breadwinners. When the insured pass away, the lifestyle and assets of the family are protected, and they wouldn’t be left with a financial burden. However, it is only one of the uses of a life insurance plan.
Some might argue that getting a plan for infants and young kids doesn’t make sense since no one depends on them. Another thing is that the amount of protection you can get them is limited to the amount based on the parents’ plans.
There are a lot of advantages to getting a plan for infants and young children. For one, the cost of protecting them is way cheaper than adult plans. If the plan is overfunded, more money goes to the savings component of the plan. If that plan includes bonuses, the bonuses will soon cover the cost of maintaining the plan. Soon enough, all the contributions will go towards the savings component, opening up many opportunities.
“Setting up a child’s life insurance plan
is like setting them up for a brighter future.”
One of the barriers to getting a plan with lots of financial benefits like life insurance is insurability. It refers to the acceptability of an applicant to be approved for a plan. Many factors affect insurability, but health is one of the most significant factors. Another advantage of setting a plan early is locking in a child’s insurability. Suppose they develop health-related issues in the future. In that case, this wealth-creation tool is already set up and still available. Because these plans are flexible, they can cater to most, if not all, of the financial goals you have for your kids.
Alternatively, people in their golden age or who are not insurable anymore can take advantage of their babies’ insurability to create a retirement plan for themselves. They can grow cash values inside their kids’ plans to be used for their own retirement, depending on how much they can fund the plans and how long the parents are willing to wait before they retire.
These are just a few benefits of setting up a life insurance from infancy. We must remember that the earlier we establish this for our children, the more flexible the plan will be. It will serve our family and us more today and in the future.
Youth
Once you or your kid is of age, you can transfer the ownership of the plan or still control it and use it to their advantage. Alternatively, if you still don’t have a plan, getting one at this stage still enjoys a lower cost than adult plans.
Getting a plan in this stage presents the same advantage as an infant, albeit with a lesser impact. However, we can use this opportunity to explain to our kids the importance of saving and utilizing the right financial plans for our financial goals. We can also teach them about the time value of money and how to use being young and time to our advantage.
The plans set up at this stage can still be used for the kids’ education, first car, house, retirement, etc., and even a financial legacy to your grandkids. It depends on how the plan is created, how much is contributed, for how long, and how the plan is utilized.
It’s essential to work with a trusted insurance advisor to help you set up the right plan for you and guide you through the process of accessing the cash values in the plan.
Maximizing a plan like this for your children at this stage is one of the best wealth-creation tool you can set up. It will also be the smallest amount of money that will significantly impact their future. By utilizing a life insurance plan, we’re ensuring that they’re protected for today and when the time comes that we’re not here anymore.
Adulthood
Owning life insurance at this age now becomes a no-brainer. This is where the phrase, “If you love someone, you need life insurance,” really starts to make sense. At this point in our journey through life, it’s where we probably start having the relationships that we’re going to have all of our lives. Some of us might still live in our original houses, and some might have already begun building our families.
Whoever are the people who are important to you, one way of ensuring they’ll be ok if something happens to us is to set up a life insurance. It’s a surefire way to prepare for life’s inevitabilities.
Some might also pursue their passions and build a business. Life insurance can be an invaluable tool to expand our ventures and make our dreams come true. Take, for example, Walt Disney. “In 1955, Walt Disney couldn’t secure a bank loan through traditional forms of financing to build Disneyland.” Suppose he didn’t set up a Life Insurance plan many years before making his dreams a reality and know how to take advantage of the Living Benefits of his plan. In that case, we might not have Disneyland right now. The 12 parks of Disneyland are successful, and their business model is being copied worldwide.
Retirement and Golden Age
At this point, we hope that everyone is already utilizing their Life Insurance plans and getting a substantial retirement or at least enough to supplement their current lifestyle.
If not, most people will probably think of shying away from getting life insurance because they don’t see the benefits anymore aside from the death benefit. While most of this is correct, most life insurance plans can still provide significant value even at this late stage in life.
When you get approved, you can leave a substantial financial legacy behind so your family can have a headstart in life. You can also get annuities if you are willing to put in good capital and essentially provide an outstanding amount of money, split into regular annual payments. An annuity can provide a structure and financial security to your loved ones.
After retirement or what we can call the Golden Age, is the time when we can make sure that we can pass on the most amount of money for generations to come with the least amount of headaches. Setting up a life insurance is one, if not, the most effective, secure, and efficient way of transferring wealth. You can rest assured that whatever you’re passing on will be direct, automatic, bypass probate, and tax-free.
“Life Insurance might as well be called ‘Love Insurance.”
The truth is that setting up a Life Insurance plan can give you and your family more than it looks on the surface and what the popular opinion is letting you on. The most prominent advantages include protection for today and tomorrow, wealth-creation, especially if you start early, and legacy to your loved ones, wherever you are in life.
In one of the letters that our advisors read to our clients by the end of explaining their plans, it says, “When your work and labour are done, mine will begin. Through me, your hands can carry on…remember that I can do more for you and your family than you will ever do for me. If you do your part, I will do mine…Sincerely yours, Your Life Insurance Policy.” Wouldn’t you agree?
A life insurance plan is one of a few things you can set up no matter when, and you will always get more of what you put in as long as you stick to it and, of course, depending on the structure. This age is where the term love insurance shines. When you get one at this stage, whatever you’re putting in is like paying forward towards your family and the generations that will come after. It is a selfless act that will benefit the future greatly with minimal effort on your part.
That’s why, here in Greatway, we believe everyone should set up a love insurance. We said it before, and we’ll say again, “You need life insurance if you love someone.”
If you love someone and need life insurance, please don’t hesitate to contact one of our agents; they will help you get the best plan for your goals and wherever you are in life.
