How to Be Life Insurance Rich, Not Poor

Life Insurance

Permanent life insurance is one of the more confusing topics when it comes to your personal finances. Most people would admit that they never want to be insurance “poor”, yet at the same time, they want the protection. So the task is always daunting when you’re trying to decide to buy permanent versus temporary or “term” insurance.

What if you could justify the cost of the term life insurance by owning a permanent policy as well? Imagine if you actually got the term insurance for free!!! It’s possible to do this by having a combination of the two products.

The mentality of it is simply, term covers you for a specific period of time. Once that time is up, so is the insurance. Like car insurance, if you never have an accident you were simply covered in case you ever did. It is the same principal with term life insurance. You never passed away, but during that period of time you had coverage in case there was a catastrophic loss.

Problem is, after paying into a 20 year term policy, you look at how much money you spent on that product. What if you could get that money back? Well, if you own a permanent life product, technically you can. Permanent life products cost a little more, but they build “cash” value inside of them. If you owned a combination of both permanent and term, you could actually justify the cost of the term insurance based on the cash value you built up inside your permanent policy.

The thought process here is, once the cash value in the permanent product equals the premiums you paid for the term, you basically got your term insurance for free! So instead of being insurance poor, be insurance rich by owning a combination of both policies and having the permanent justify and pay for the term life insurance over time. 

About the author: Mark Yurkovic has been in the life insurance business for over 12 years, and holds CLTC, LUTCF, and CES designations. He enjoys building remote control boats, and playing instruments including the piano, guitar, banjo, and mandolin. Mark would love to discuss life insurance options and work towards finding the best policy fit for your family. You can contact Mark at 1-800-651-1953 or MYurkovic@Pivot.com.