This is not a safe bet

Jun 11, 2020 | Blog, Insurance | 0 comments

In Las Vegas the house is designed to win.

Imagine that you’re in Vegas, and there is a roulette table, where all the slots but one are black.  The caveat is that you are only allowed to bet on red.   And the chances of it landing on red are less than 5%.

This is not a safe bet.   It’s designed for you to lose.    And chances are … you are probably making that bet right now within your financial plan.

Is your financial plan designed for you to lose?

Term insurance is designed for the house (the insurance company) to win … not you.   It’ like a roulette wheel with 95% black slots and you only win when red comes up.

As a wealth strategist I develop a coordinated wealth plan for my clients that are very holistic in nature.   And I illustrate to them the true cost of term insurance.   Let me show you an example.

Let’s say you are paying Term 20 insurance costs of $1,000 a year.     A lot of people think, hey, worst case scenario is I lose $20,000 right?   WRONG.

If you knew you were going to live 21 years you never would have bought the term insurance.   You would have invested that money.   A $1,000 a year at 8% is $45,761.    That’s your lost opportunity cost.

But it actually get’s worse.    You can drop the term insurance, but you can’t drop the loss.    It continues.    That $45,761 could have provided $4,661 of income over a 20 year retirement period.   That brings the total loss to $93,219.

Why would you make a financial decision, that if you get what you want, a long healthy life, you are a loser financially?

So consider this question … What type of insurance is best for YOU?    (not the financial institution)   The type that you pay into with little hope or desire for a return?   Or the type you pay into with a guaranteed tax free return in retirement?    And that pays out an additional guaranteed death benefit when your life is over?

If I can show you a better built plan that allows you to spend and enjoy all your assets, for you and your family’s enjoyment, and then when life is over, pass them along to those whom you care about, would that be worthwhile? 

Book a free consultation