Life Happens; Be Prepared

Life Happens; Be Prepared

September is Life Insurance Awareness Month, a campaign coordinated by the nonprofit LIFE Foundation in response to growing concern about the number of Americans who lack adequate life insurance protection. According to LIFE, approximately 70 million adult Americans have no life insurance, and most of those who do, have far less coverage than most financial experts recommend.

So what is the right amount of life insurance? As with many personal finance numbers, that depends on your circumstances, your stage in life and your future plans. Certainly at its most basic, life insurance is intended to offset the financial impact your death may have on the lives of your dependents. That impact may be simply the costs of your final expenses, such as funeral costs, medical bills, taxes, debts and professional fees for attorneys or accountants. Or the impact may be more significant, as in the case of a stay-at-home parent and his or her children, who depend solely on a spouse’s income for all of their day-to-day needs.

Life insurance can factor into more complex financial needs, such as leaving a legacy to your children or favorite charities. It can be important for a small business owner, providing the funds for the heirs to purchase the business or replace the business income if they must close or sell it. If you have a large estate, life insurance can provide funds to pay for estate taxes that would otherwise limit your legacy.

Over your lifetime, your life insurance needs will change. At certain times you may need to increase or decrease your life insurance coverage. While on its surface life insurance may seem to be a one-time decision – you buy it, have the premium deducted from your bank account and never think about it again – it can be a dynamic part of your financial picture.

If you or a loved one needs help in evaluating your life insurance needs, including whether your current coverage is appropriate, please contact your financial advisors office. We will gladly work with your existing insurance agent, handle your insurance needs at our office or recommend an agent to work with you.

FINANCIAL FACTS

I’ve Got It Covered – Forty-four percent of more than 1,500 Americans surveyed this year believe they have planned and saved sufficient assets to allow them to live their desired lifestyle until age 85. Thirty-five percent believe they have prepared adequately to maintain their desired lifestyle until age 95 (source: Northwestern Mutual’s 2013 Planning & Progress Study, BTN Research). 

Every Day – An estimated 9,200 Americans will turn 65 years old each day this year (2013). An estimated 11,400 Americans will turn 65 years old each day by the year 2029 (source: Government Accountability Office, BTN Research).

Two Out Of Three – The month of August produced a loss of 2.9 percent for the S&P 500 (total return), only its second “down” month this year (out of eight months YTD). Over the past 250 months (through Aug. 31, 2013), the split is 65 percent “up” and 35 percent “down” for the S&P 500 (source: BTN Research).