Financial Tools
Term Life
Quick Calculation:
Insurance Need = Annual Income x 10-12 + Mortgage + Other Debts + College Costs + Funeral Costs
Example:
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Annual Income: $75,000
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Mortgage: $200,000
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Other Debts: $20,000
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College Costs (2 kids): $200,000
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Funeral Costs: $15,000
Insurance Need:
This family would need approximately $1.2 million in life insurance coverage.
Self Employed & Entrepreneurs
Quick Calculation:
Insurance Need = (10 to 12) x Annual Income + Business Debts + Funeral Costs + Legal Fees + Buy-Sell Agreement Value
Example:
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Annual Income: $100,000
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Business Debts: $100,000
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Funeral Costs: $15,000
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Legal Fees: $20,000
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Buy-Sell Agreement Value: $500,000
Insurance Need:
This entrepreneur would need approximately $1.6 million in life insurance coverage.
Here are a few examples of how you can quickly calculate your insurance needs.
High Risk Occupations
Quick Calculation:
Insurance Need = (12 to 15) x Annual Income + Mortgage + Other Debts + Funeral Costs + Emergency Fund
Example:
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Annual Income: $60,000
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Mortgage: $150,000
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Other Debts: $10,000
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Funeral Costs: $15,000
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Emergency Fund: $25,000
Insurance Need:
This individual would need approximately $920,000 in life insurance coverage.
Wealth Transfer & Estate Planning
Quick Calculation:
Insurance Need = [(Estate Value - Exemption) x 40%] + Funeral Costs + Legal Fees + Other Bequests
Example:
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Estate Value: $20,000,000
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Exemption: $13,610,000
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Funeral Costs: $15,000
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Legal Fees: $25,000
Insurance Need:
This individual would need approximately $2.6 million in life insurance coverage to cover estate taxes and other expenses.
Indexed Universal Life
Indexed Universal Life (IUL) policies offer a compelling alternative to traditional investment vehicles like 401(k)s and IRAs by combining growth potential with protection. Unlike 401(k)s and IRAs, which are subject to market volatility, IULs provide the opportunity to earn interest based on the performance of a market index, while also protecting against losses with a guaranteed minimum interest rate. Additionally, IUL policies offer living benefits, such as access to cash value for medical emergencies or retirement income, as well as death benefits that provide financial security to beneficiaries. A unique advantage of IULs is the ability to borrow against the policy's cash value, allowing you to access funds for retirement or investments tax free. This strategy enables you to essentially become your own bank, using the policy to finance major life events while still enjoying the benefits of compounding growth within the policy.
Term Life
Term life insurance provides a simple and affordable way to protect your loved ones financially. It offers coverage for a set period, such as 10, 20, 30, or 40 years, ensuring your family is protected if you pass away during that time. The policy pays a tax-free death benefit to your beneficiaries, which can help cover living expenses, mortgage payments, or college tuition. Since term life insurance focuses on pure protection without cash value, it is usually less expensive than other types of life insurance, making it a cost-effective choice for those who need coverage during key stages of life.
LASER
Liquid
Asset
Safely
Earning
Returns
LASER IUL allows you to access the cash value for retirement income, emergencies, or investments without triggering taxes, while protecting against market downturns. The policy's cash value grows tax-deferred based on index performance, offering potential higher returns compared to traditional savings methods, making it a versatile and strategic tool for long-term wealth building.