Colorado Life Insurance
We understand that a conversation about life insurance is not always an easy one, but should be part of your long-term planning. There are many good reasons to consider purchasing life insurance. Life insurance gives your loved ones the resources to pay off debt, continue living the same standard of living, and provides added financial security.
How Much Life Insurance Do You Need?
- How much will be required to meet my family’s financial obligations?
- How much debt do you have other than your mortgage?
- What are the future income needs of my family?
Once you know this, we can provide you with limit and pricing options. Here is an example for you to consider.
Mortgage/rent $1,200
Expenses $3,000
Savings $ 800
Under this example, it takes around $5,000/mo ($60k/yr) of after-tax income to sustain your family. If you are gone, we might expect your family to need that same amount of after-tax income. You would need a death benefit amount of $600,000 in this example. When that death benefit is invested with an average return of 10%, it can provide $60,000 annually. We understand that investment returns change over time, but this is a reasonable approach.
For a more specific analysis, check out my Life insurance calculator.
Term life insurance can be very cost effective because it only covers you for a certain term, say 20 or 30 years. The price is based on how much coverage you need, current age, and length of time you would like the coverage. You pay as you go and can drop the policy at any time.
Permanent life insurance can also be a great tool. It provides a death benefit until the day you die (not only for a term), transfers your wealth tax-free to your heirs, and solves many retirement income and tax problems.
For the purchase or information on any kind of personal insurance products for clients in Colorado, contact our agent Gail Longenecker.