Your Money or your Life....Insurance

Your Money or your Life....Insurance

You either need to have life insurance or money and you should never have both.  Life insurance should always be a short-term measure that protects the people that you care about in the event that something happens to you.  While you’re protected by a non-participating, term life policy you need to be saving, so that eventually you will no longer need that insurance.

Term life is dirt cheap when you’re young, and gets more expensive as you get older.  With that in mind, as your net worth grows, you should gradually begin to scale back on the face amount of your term life policies.  

The real savings here are from where you get your term insurance.  The answer is, From anyone except your insurance agent.  Now don’t get me wrong, I love insurance agents.  I was an insurance agent for a while.  A life insurance agent has access to a dizzying array of financial instruments that might be useful to you at different times in your life.  Unfortunately, the life insurance that comes from an agent – even term insurance - is always the most expensive.

So, where should get your term life insurance?  You can get it from any groups that you belong to.  That includes extra coverage from your employer; any professional or trade association that you belong to; any educational alumni association; a service club or fraternal order; automobile associations – the list is endless. 

Yes, everyone should have life insurance, just don’t buy it from an insurance agent.