A Primer On Life Insurance For Mothers

One of my client's wives paid me a visit to ask about life insurance, , High Risk Auto Insurance How To Lower Rates a product I was well acquainted with. She told me that she and her husband were visited last night by a life insurance , Check Your Credit Rating Before Stoozing agent. "Jan, what did he try to sell you?"

"A $90,000 whole life policy with an annual premium , Budget Car Insurance How To Get Quotes And Insurance On A Budget of $500. Is that okay?"

Knowing that few people really understand life insurance, , Dont Bet Your Home I asked her if she really understood what the agent was talking about.

"I thought I did last night," she replied, "but when I woke up this morning, I wasn't so sure. That's why I'm here. You once told me to never buy life insurance , E Privacy Fact Or Fiction unless I talked to you about it. Well, I'm here. Could we chat about it?"

I was glad that Jan was here instead of Mark. I have learned that it is much easier to talk to women about life insurance , How Can I Sell A Structured Settlement Payment than men. Women seem to better understand the financial , Affordable Individual Health Insurance How To Control Your Owninsurance Costs consequences of their spouses' death, especially if they are mothers. Most men, however, don't want to face life insurance , Dont Bet Your Home because they think that they will never die. Women know better.

I was no stranger to the murky world of life insurance. , Two Things You Need To Know About Prepaid Debit Cards Throughout my 20 years as a CPA, I'd often locked horns with insurance , Consolidate Your Student Loans In 3 Easy Steps agents and financial , Credit Repair Collection Agency planners who wanted to sell garbage life insurance , Overboughtoversold products to my clients. In my role as a CPA, I always believed that it was my job to act as a mother hen and protect my clients from the wolves.

I began by asking Jan a question that zooms to the heart of the matter. "Tell me Jan, why are you buying , Credit Repair Collection Agency life insurance? What do you hope to accomplish?"

She answered, "To protect me and the children in case Mark dies."

That quickly established the fact that Jan knew about the key issue: that life insurance , Non Profit Debt Consolidation Rebuild Credit With A Debt Consolidation has but one purpose: protection in case disaster strikes.

Then I asked her another question. "Just suppose that you knew for sure that Mark was going to die tomorrow. How much life insurance , Details Of The Pulaski Credit Card Application would you buy , Two Things You Need To Know About Prepaid Debit Cards on his life ---$90,000 or $450,000 --- assuming the premiums were identical?"

She looked at me as if I was crazy. "I'd buy , Credit Repair Collection Agency the $450,000 policy. Who wouldn't?"

I then gave Jan a quick education about life insurance, , Overboughtoversold explaining that there are only two kinds of life insurance, , Check Your Credit Rating Before Stoozing term and cash value. , Low Interest Rate New Car Loan Tips For A Smooth Car Buying Experience The problem is knowing which one of them is the better buy. , Budget Car Insurance How To Get Quotes And Insurance On A Budget

Term insurance , Why A Good Credit Score Is Important To Your Business is pure insurance , The Long Financial Winter Protect Your Home ( protection) coverage. If you pay , What Is Forex Foreign Exchange the premium , Why A Good Credit Score Is Important To Your Business and die , the insurance , The Long Financial Winter Protect Your Home company will pay , Affordable Individual Health Insurance How To Control Your Owninsurance Costs the face value , Non Profit Debt Consolidation Rebuild Credit With A Debt Consolidation of the policy to your beneficiary. It is available to age 95 and can be purchased yearly, or on a guaranteed level premium , Why A Good Credit Score Is Important To Your Business basis for 5,10,15, or 20 years. The product is uncomplicated and very inexpensive. , Make The Most Of Every Opportunity With A Loan The premiums, however, do increase each time the policy is renewed since the insured has grown older.

Cash value life insurance , Cheap Car Insurance (sold as whole life, endowment, straight life, permanent life, universal, and a zillion other names) is the second type. It differs significantly from term because there is a savings , Affordable Individual Health Insurance How To Control Your Own Insurance Costs or investment , A Mortgage And Bank Trick You Should Avoid At All Costs feature attached--the cash value. , Car Insurance Tips Tricks About 75% to 80% of every premium , Term Life Insurance Definitionwhat Is It dollar goes to this cash value , Credit Repair Collection Agency "kitty" and the remainder pays , Top Questions You Need To Ask Your Childs Daycare Aboutemergency Preparedness for the actual life insurance , Cheap Car Insurance protection. These policies typically last to age 100 and the premiums remain level for one's entire life.

Thus, in one slick package, a cash value life insurance , Check Your Credit Rating Before Stoozing policy claims , My Neighbor Got A New Car to accomplish two worthy goals: death protection and family savings. , A Guide To Getting A Mortgage It was my job to convince Jan that cash value insurance , Non Profit Debt Consolidation Rebuild Credit With A Debt Consolidation fails miserably on both counts and that she must, for her and her children's sake, buy , A Guide To Getting A Mortgage pure term life insurance , Business Credit Card How To Find The Right Card and nothing else.

"Jan, there are two reasons why you must not buy , Non Profit Debt Consolidation Rebuild Credit With A Debt Consolidation that whole life policy or any other cash value , Check Your Credit Rating Before Stoozing product. First and most importantly, cash value life insurance , Holiday Loans A Loan Package Full Of Fun is anywhere from five to ten times more expensive , Check Your Credit Rating Before Stoozing than the equivalent amount of term insurance. , Low Interest Rate New Car Loan Tips For A Smooth Car Buying Experience It's like paying , High Risk Auto Insurance How To Lower Rates $75,000 for a $15,000 automobile just because you went to the wrong dealership."

To keep their customer's attention away from the high cost , Free Mortgage Guidebook Will Save You Thousands of cash value, , Factors That Trigger Credit Card Rate Hikes agents focus their sales spiel on the investment , Preparing For Good Times And Bad feature, usually with the aid of reams and reams of incomprehensible computer printouts. This sales tactic has literally duped the American public out of trillions of dollars in the last 150 years, ever since cash value , High Risk Auto Insurance How To Lower Rates was invented.

"Jan, how much time did the agent spend , Poor Credit Mortgage Refinance Getting Approved last night talking about the actual insurance , Types Of Home Equity Loans protection versus how much money , Term Life Insurance Definitionwhat Is It you'll earn from the cash value , Car Insurance Tips Tricks policy?"

She thought a bit before answering. "Well, he spent the whole evening going over a bunch of computer printouts that showed us how rich , Warning Credit Repair we'd be in fifty years when we retire, and how much we could borrow from the policy if we ever needed a loan. , Master The Art Of Debt Management "

"But what did he say about your protection needs?"

"Come to think about it, hardly anything at all. After we told him that we could afford a $500 yearly premium, , Details Of The Pulaski Credit Card Application he looked in a book and said that he had found a great $90,000 whole life policy that we could afford. But about protection, he really said very little." I could tell that she was starting to bristle in anger, a sign that I was doing a good job.

I then told Jan that people with children living at home , Details Of The Pulaski Credit Card Application should have, as a rule of thumb, about eight to ten times their yearly gross income , Cheap Car Insurance in life insurance , Latest Money Saving Tips For The Over 50S protection. For Mark and Jan, that translated into at least $475,000. The agent who met with them should have figured that out and done his utmost to assure such adequate protection.

"You see Jan, that agent's sole emphasis should have been on your financial , Your Down Payment And Your Mortgage protection in case Mark dies tomorrow, not about making you a rich , Your Down Payment And Your Mortgage lady in 50 years. The agent's decision to sell you the anemic whole life policy would literally rob you and your kids of $385,000 if Mark dies tomorrow."

"But Mark is not going to die tomorrow. Don't say that!"

"Jan, you don't know that. He could die tomorrow or in a week from any one of a thousand and one different causes. And so could you or I. That's why you must be fully protected right now. Life insurance , A Guide To Home Equity Loans is a today need."

I continued..."Jan, remember when I told you that there were two reasons to avoid cash value , Overboughtoversold life insurance?"

"Yes."

"You told me Jan that the agent spent most of last night talking about the wonders of the cash value investment. , Holiday Loans A Loan Package Full Of Fun Now I am going to give you the real scoop about that." This one always puts the final nail in the cash value , Consolidate Your Student Loans In 3 Easy Steps coffin.

"The cash value, , Free Mortgage Guidebook Will Save You Thousands " I continued, "is not like an ordinary investment , Successful Trading Trading Systems such as stocks, , Preparing For Good Times And Bad bonds, , Consolidation Period or a bank , How Can I Sell A Structured Settlement Payment savings account. , Top Questions You Need To Ask Your Childs Daycare Aboutemergency Preparedness "

"But the agent said it was just like a bank , Top Questions You Need To Ask Your Childs Daycare Aboutemergency Preparedness savings account. , What Is Forex Foreign Exchange .."

"It resembles a savings , A Guide To Home Equity Loans account about as much as a shark resembles a goldfish. Tell me Jan, what do you think happens to the cash value---the promised pot of gold---if Mark dies? Who gets it?" The fun starts...

"That's easy," she replied, "I do...it's our money. , Boat Loans The Most Convenient Way To Become A Boat Owner ..our investment. , Business Credit Card How To Find The Right Card ..right? Marsh...tell me I am right!"

"Sorry, you are wrong. If Mark dies, the insurance , Two Things You Need To Know About Prepaid Debit Cards company keeps it. That means that all that extra premium , How To Invest Wisely And Make Your Money Grow you paid for so many years goes up in smoke."

"So what do I get if Mark dies?"

"You get the face amount of the policy...but you could have gotten that for a fifth of the premium , Boat Loans The Most Convenient Way To Become A Boat Owner with a term policy."

"Marsh...you can't be serious. In my worst nightmare, I would not expect something like this. Are you sure?"

"Very. But if you want some proof of your own, get the book What's Wrong With your Life Insurance , Boat Loans The Most Convenient Way To Become A Boat Owner by Norman Dacey. That's just one of many books in the library that echoes what I have been yapping about. Don't think I am the Lone Ranger on this."

Apparently she got fed up. Her voice rose as she said, "The agent never said word one about any of this! Are you telling me that he bent our ears off last night just to sell us a chump change policy that will leave me seriously underinsured just so he could make a bigger commission...and that they steal my investment , Affordable Individual Health Insurance How To Control Your Own Insurance Costs to boot if Mark dies?"

"That about hits the nail on the head. And one more thing...when you tell the agent you want a term policy instead, expect another visit from him. Be aware that they are very well trained in changing minds. Plus, you might want to shop around for the best deal. Even among term policies there is a wide variance in price. , Overboughtoversold "

End

Postscript:

It is this author's hope that anyone in possession of this article pass it onto their relatives, friends, and neighbors. The information in this article can put many thousands of extra dollars in the bank , The Growing Debt Problem For Under 25S In The Uk accounts of those who need it most.

Copyright 2000
Marsh Kaminsky CPA (retired due to disability)
e mail: Thetermite@aol.com

Because of Multiple Sclerosis, I am a retired CPA. Besides my interest , Holiday Loans A Loan Package Full Of Fun in life insurance, , Make The Most Of Every Opportunity With A Loan I have a very strong interest , Two Things You Need To Know About Prepaid Debit Cards in early preschool learning.