September is designated as Life Insurance Awareness Month. According to recent studies, the average family should have $1,300,000 more life insurance than they have. That may sound a bit aggressive so an example may help.
When interest rates were at 5%, you could take $1,000,000 of tax free insurance death benefits or other cash assets, invest them in a guaranteed account and receive $50,000/year of income and leave your $1,000,000 principle intact. With current guaranteed interest rates in the 1% range or less, it would require $5,000,000 to produce the same $50,000/year of income.
Remember…you want to live off the income of your assets NOT live off of your assets. Having to draw down the principle leaves less to earn interest and depletes the asset.
Take a look at your liquid income producing assets and current death benefits your loved ones would receive should you be taken out of the picture. Would they produce enough income (you choose the interest rate you are comfortable with) to take care of your loved ones the way you would like?
Think about it!!
Contact Russ Caforio at firstname.lastname@example.org or call 630-495-2901 to review your situation and consider your options.