Isn't That Rich Podcast

Life insurance might not be the most thrilling topic, but it's one of the most crucial aspects of financial planning. If you think life insurance is only for the elderly or those with a morbid streak, think again. Let’s dive into why life insurance is essential, who needs it, and the different types available. Our expert for today is Eric Witges, COO of FSB Insurance, who brings a wealth of knowledge and some personal anecdotes that highlight the importance of life insurance.

Why Life Insurance?

Think of life insurance as a safety net. It's there to catch your loved ones when life throws them a curveball. If you have a mortgage, car payments, student loans, or kids who might one day head off to college, life insurance provides a way to cover those expenses if something happens to you.

As Eric shared, life insurance isn't just about providing for your family after you’re gone; it also offers peace of mind. Knowing that your loved ones won’t be left scrambling financially during a crisis is invaluable.

Who Needs Life Insurance?

Short answer: almost everyone. Long answer: it depends on your individual circumstances.

• Parents with young children: Ensure your kids are taken care of, even if you're not around.
• Homeowners: Prevent your family from losing their home if they can’t make the mortgage payments without your income.
• Business Owners: Protect your business from financial strain or closure after your passing.
• Single people: Even if you’re single with no dependents, consider how your funeral costs and outstanding debts will be covered.

Types of Life Insurance

Life insurance isn’t one-size-fits-all. Here’s a quick rundown of the main types:

1. Term Life Insurance: This is the most straightforward and affordable option. It covers you for a specific period (10, 20, 30 years). If you outlive the term, the coverage ends, but it’s great for covering needs like paying off a mortgage or ensuring your kids' education expenses.

2. Whole Life Insurance: This policy covers you for your entire life, as long as you keep up with the premiums. It’s more expensive but comes with a cash value component that you can borrow against if needed. Think of it as having equity in your policy.

3. Universal Life Insurance: This is a flexible option that combines the benefits of term and whole life insurance. It offers a savings element that can build cash value based on market performance. It’s more costly but can be a good choice for those looking for an investment component along with their insurance.

Riders and Additional Coverage

Life insurance policies can be customized with riders, which are additional benefits that you can add to your policy for extra coverage. Here are a few to consider:

• Disability Income Rider: Provides income if you become disabled and can’t work.
• Critical Illness Rider: Offers a lump sum payment if you’re diagnosed with a serious illness, like cancer.
• Return of Premium Rider: Refunds the premiums you’ve paid if you outlive the term of your policy.

Choosing the Right Policy

Selecting the right life insurance policy involves more than just comparing premiums. Here are a few tips:

• Research the Company: Ensure the insurance company is reputable and financially stable. Look for an AM Best rating to gauge their reliability.
• Work with a Trusted Agent: Find an agent who understands your needs and isn't just looking to make a sale. A good agent will help you tailor a policy that fits your life and goals.

A Final Thought

While no one likes to think about their own death, planning for it is one of the most responsible things you can do for your loved ones. Imagine the peace of mind knowing that your family is financially secure, even in your absence.

As Eric reminded us, life insurance is about more than just money; it’s about legacy and love. Take the time to sit down with a trusted advisor and discuss your options. Your family’s future might just depend on it.

For more information or to get a quote, you can reach out to FSB Insurance directly at 618-253-7165 or visit their website. Don’t wait until it’s too late—ensure your legacy today.