The Better Investment: Go With The Guaranteed Returns Of Insurance
“Real Estate is the best investment.”
“My retirement plan can’t be beat for the returns I get.”
I have heard these refrains over and over during my nearly 50 years in the insurance business. My reply has often been "perhaps." While those statements could be true, I do know that life and disability insurance can lock in value and guarantee benefits in ways other investments cannot. Insurance is an important part of a financial plan that helps to protect your other investments, whether in real estate, retirement accounts, or something else.
Lately, the hot investment has been crypto currency. The other day, I heard that over $1 trillion is currently invested worldwide in these quasi currencies. Frankly, I don’t understand the appeal, with little or nothing to back up the value other than people's desire to believe in it. Among the many positive news stories and articles I’ve seen and read, there have been plenty of counterbalancing stories of people losing large sums with no recourse to recover their losses.
However, I am not here to argue about crypto's value. What is relevant to this discussion is that NO United States life insurance company allows for investments to be made, premiums to be paid, or claims to be awarded in these currencies.
That’s good enough for me to be wary of crypto!
Understand that I’m all in favor of quality investments in real estate, retirement planning, and individual investing in quality stocks. Insurance coverage provides a stable base for your overall financial success, whatever other investments you may have.
It can be very difficult to accumulate and maintain wealth without the security of life and disability coverage. Disability insurance protects your income if you are disabled and unable to work. Otherwise, you would need to draw on your assets to meet your living expenses.
When you include a quality long-term care insurance coverage in your plan, you help safeguard your financial independence, while protecting your assets from being depleted to cover the cost of your care. Well-designed coverage protects your financial legacy for you, your family, and your business, if you own one.
Given how the crypto market fluctuates, it certainly cannot guarantee financial security. Today's fad may not be around tomorrow. Insurance endures. And it works for effective financial planning not only for yourself, but also for your loved ones.
Let me leave you with an example of how insurance can work to preserve generational wealth.
Dave and Donna L. want to provide for their grandchild. They have allocated $100 per month to help provide financial security for that child. They would be wise to buy a whole life insurance plan for their grandchild – through life insurance coverage, several things would be set in place immediately, with important guarantees:
• The child’s parent can be owner of the policy, and if the named parent dies or becomes disabled, the grandchild’s policy is guaranteed to be paid up.
• Payments can stop by policy contract in no more than 20 years and the insurance continues to be in full force.
• The grandchild, when they become an adult, can use their own policy as collateral.
• And finally, with great foresight, the policy guarantees that a child has several options beginning at age 25 to purchase additional policies or coverage without any additional qualifications needed.
Can any other investment do the same? The answer is a resounding No!
Interested in learning more about how insurance planning can work for you? Call us today! Our consultation is always obligation- and cost-free.