Only 50% of Americans have life insurance

First, let's talk about what life insurance is.

Life insurance is when you pay a premium for a period of time in exchange for a cash benefit (aka death benefit).

The cash benefit will be paid to your named life insurance beneficiaries when you pass away.

And here's the biggest life insurance benefit:

The death benefit is TAX-FREE to your beneficiaries.

So your beneficiaries could get paid $100,000's from a death benefit and never have to pay a single PENNY in taxes.

You can always change your designated beneficiaries.

You can also have:

- Primary beneficiaries
- Secondary (aka contingent) beneficiaries

If your primary beneficiary passed away...

Then the death benefit would go to your secondary beneficiary.

Here's an example of the application process:

- First, address basic medical information
- The healthier (and younger), the cheaper the premium
- Second, take a medical exam at home, office, or clinic
- Third, the underwriters will review your app & medical exam results

Your life insurance premium will be based on several things including:

- Age
- Health
- Need (do you NEED a $900k coverage?)

There are MANY ways to reduce your life insurance premium:

- Lower death benefit
- Eliminate special riders
- Switch insurance company
- Live a healthier lifestyle & prove it with medical/doctor records

One easy way to reduce premiums might be to switch the TYPE of insurance.

There are MANY different types of life insurance policies:

- Term life insurance
- Whole life insurance
- Universal life insurance
- Variable Universal life insurance

But which type is best?

In reality, the best type of life insurance depends on your own financial and health situation.

The 2 main types of life insurance include:

1. Permanent Life
2. Term Life

Permanent life insurance covers your life until you pass away.

It's permanent.

And it's often much more complex than term life insurance.

Because it's more complex, it's also more expensive.

Much more expensive.

Permanent Life Insurance includes:

- Whole life insurance
- Variable life insurance
- Universal life insurance

Here's a quick break-down:

Whole Life Insurance

- Expensive
- Permanent life insurance
- Has cash value = savings component with a fixed interest rate
- Your cash value builds up over time from the premiums you pay
- You may take a life insurance loan against your cash value

Universal Life Insurance

- Expensive
- Permanent life insurance
- You can adjust your monthly premium amounts (within limits)
- You can adjust your death benefit
- Has cash value = savings component with a variable interest rate

Variable Universal Life Insurance

- Riskier
- Expensive
- Permanent life insurance
- You build cash value by investing in certain funds offered through the life insurance policy
- Cash value can be added on top of your death benefit

Term Life Insurance on the other hand covers you only for a specific time period (aka a term).

It's simple.

And cheap.

Typical "terms" of coverage include:

- 10 yrs
- 20 yrs
- 30 yrs

When the term is up, and you're still living, you lose the insurance coverage.

Term Life Insurance:

- Is cheap
- Provides coverage for a set number of years
- Locks in your rate for the duration of your term

So what's the most popular life insurance?

Term Life Insurance.

In fact ~48% of Americans carry term life insurance.

And here's why I agree that's a good thing:

Pros of Term Life Insurance:

- It's simple
- It's flexible
- It's affordable
- It's good for young families
- There's no penalty for canceling

Here's when you may want to consider buying term life insurance:

- You're young
- You have kids
- You have debt
- You're married
- You're in relatively good health
- You're the primary breadwinner
- You want to keep insurance expenses low
- You own a business & have partners

But Buyer Beware:

Don't just get term life insurance.

Make sure to get LEVEL term life insurance.

Level term life insurance means you will lock your premium for the duration of the term.

The cost will never change for that term duration, which makes budgeting much easier.

It's never fun to think about your own mortality, but it's INCREDIBLY important to act sooner than later.

Giving your beneficiaries a TAX-FREE death benefit is one of the BEST ways to build generational wealth.

Thanks for reading!

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