What You Need to Know About Borrowing from a Life Insurance Policy

Borrowing from Life Insurance Robert Taurosa

When life insurance policies were first introduced, they were meant to cushion the beneficiary from financial worry in the event of the insured’s death. However, as time passed by, life insurance incorporated savings and investment into the package. Policies such as whole life and universal life insurance provide cash value back to the insured.

What You Need to Know

You cannot ask for a loan if you have a term life insurance policy. This is because the insurer does not offer any additional benefits. A term policy is only meant to benefit your beneficiaries in case you die before the contract expires.

If your policy has a cash value, think before you ask for the loan. Find out how the loan will affect your policy. Typically, when you borrow on your life insurance policy, the cash value acts as collateral. If you fail to pay back the loan, the insurer can take the cash value. However, you run the risk of losing your entire policy if the interest payments plus the actual loan amount is more than the cash value.

Before you borrow on your life insurance policy, the cash value has to be substantial. Usually, you build this value through years of saving. Talk to a qualified financial planner about how you can build up this cash value.

When asking for the loan, the insurance company will give you a form to fill. Watch out for hidden costs in the form. For example, is there an ‘opportunity cost‘ that you may have to pay? Find out if you can afford to pay the interest payments. Make sure that the loan and interest repayments won’t affect the death benefit portion of your policy.

Borrowing on your life insurance policy is much easier than borrowing from the bank. You don’t have to go through a lengthy application process. You ask, and if the cash value is sufficient, you get your loan.  

Before you borrow on your life insurance, make sure that you have the right policy. A term life policy does not allow you to borrow while a whole life policy will enable you to do so. Then, talk to a financial planner to see how the loan will affect policy benefits.

Advertisements
What You Need to Know About Borrowing from a Life Insurance Policy

Should You Purchase Supplemental Life Insurance at Work?

Supplemental Life Insurance Robert Taurosa

Supplemental life insurance is an extra life insurance policy. The employer will offer this policy as a benefit for the employee. You should purchase supplemental insurance at work if the policy meets your needs. Here are a few reasons why the employee buys this policy at work. The employee can afford the policy. The employee has a family. The employee can keep the policy. Use the following guidelines to help you make an informed buying decision about supplemental life insurance.

Affordable Payments

First, an employee will most likely buy supplemental insurance because it is affordable. Insurance companies will offer lower rates to a group of employees. This is called group life insurance. For example, an employee making $50,000 annually may receive $50,000 of life insurance at no cost. The employer will pay for the policy. Then, the employee may have the option to buy more coverage at a much lower rate. The options can turn the $50,000 policy into a $500,000 policy. A $500,000 policy will fill the gaps and help the family when the employee die.

Provide for Family

Next, the employee will purchase supplemental life insurance to provide for the family. If you get a supplemental policy from work, try to get a guaranteed renewable policy. This is the best term policy. When the employee is sick and cannot work, the insurance company has to honor the contract as long as the employee pay the monthly payment. The family can receive the $500,000 death benefit to pay medical expenses, funeral expenses, credit cards, mortgage payments, college costs, taxes and much more. A low-cost life insurance supplemental policy can help the family.

Keep the Policy

Then, the employee purchases supplemental insurance to keep the policy for life. When buying this policy, it is essential to think about making payments for many years. Buy the policy at work that you can keep for the rest of your life. The objective is to keep the policy enforced and to keep expenses as low as possible. Find out if the policy is portable before you sign the contract. Find out if the policy will also cover you and your family.

Finally, this information is not financial advice. It is written only to inform the readers.

Should You Purchase Supplemental Life Insurance at Work?

Term vs Whole Life Insurance

Life insurance is incredibly important when it comes to making sure our loved ones are left behind in safe hands in the wake of our death. However, the nuances between the varierty of insurances available can often make one’s head spin. It is for this reason that I will address some of these nuances in an attempt to make the convoluted and complicated world of hypotheticals easy to understand.

Here, I will be discussing both term life insurance and permanent life insurance. Term is a bit more simplistic and also boasts the lower cost. However, more of us have been exposed to whole life insurance since it has more publicity behind it.

Term Life Insurance

Term Life Insurance, as the name hints, only covers a certain amount of time, a term if you will.  Occasionally, you may hear this sort of plan referred to as “pure life insurance” since it’s really only supposed to protect your dependents. Terms can last anywhere from one to thirty years, yet the most common is 20 years. Generally, the premium does not increase or decrease throughout the contract, but of course every plan is its own and so it behooves you to make sure that that it is the case should you decide to move forward with a term plan.

For the record, you should pick a term plan for the years your dependents would be the most, for lack of a better word, dependent on you. This way, in the event that the worst happens, your family is provided for. Ideally, the payout they receive will be the equivalent of your current income so as to provide for the smoothest transition possible should you suddenly not be around.

Whole Life Insurance

This sort of plan is permanent, and has you covered from the start of the plan to the end of your life. This said, there is an investment involved that is titled the “cash value” of the plan. This cash value grows at a slow and steady pace and is tax-deferred so you won’t have to pay any percentage based on its gains. However, you can borrow money against the account or even forfeit the policy for cash. However, if you don’t manage to pay the plan back, with interest, you will decrease your benefits until you surrender the entire policy and the death benefit with it.

Frankly, as a whole, whole life insurance is more straightforward than term plans in that the numbers behind it don’t change. Yet, even though this is the case, the plans are typically more expensive, and although offering more benefits than term, they generally cause overbuying as well. Actually, as I mentioned in a previous article, this is because when we grow older we need less benefits, but as stated above, the numbers with whole life insurance plans don’t change. So even when you have less financial obligations and your kids are moved out of the house, you are still paying the same premiums.

This all said, it is up to you to decide which plan to pursue. Of course, every individual has unique circumstances that dictate which plan is best for them. In my personal opinion, you should always be sure to consult a professional before you commit to a plan, and remember to shop around. Insurance companies offer different pricing for different age groups and different policies, so make sure you weigh your options.

 

Life Insurance, Robert Taurosa, Scale

 

from Robert Taurosa | Life Settlements http://ift.tt/1Pmj8lg

Term vs Whole Life Insurance

Secrets to Inexpensive Insurance: Senior Edition

Old Dude

While we all grow old, many of us do not harbor an understanding of the necessity that is life insurance, especially seniors. Maturing is hard enough without worrying about the fiscal plan you’re leaving behind for your children and grandchildren. Rather than force elders to endlessly peruse through the internet, I have decided to author this quick and easy guide for a few simple tips so that those of us in retirement can have a foundational framework when searching to decrease the expense of life insurance.

Do not purchase unnecessary benefits.

Life is dynamic. Considering such, many of the benefits we need at one point in time, we no longer need later in life. To understand insurance, this is a fundamental principle. For instance, many parents are paying more money when they are younger because they are supporting children, and then paying for said children’s college. However, once the children move out, the financial obligations of said parents decrease tremendously. When this happens (or any obligations diminish), you should make sure your insurance plan reflects such. When financial commitments decrease, so should your insurance.

Work a job.

When seniors are working, they may very well be able to take advantage of their employer’s life insurance plan. Even in the event that the employer does not offer insurance, there are many other groups that may be able to supplement the cost. All you need to do is a little research to find the right plan for you.

Do a price-comparison between companies.

As with any purchase in our capitalistic society, different companies offer different prices. This being said, many companies actually price age groups differently. There is no one universal understanding of what to charge each age group. Thus, it is worth your time to shop around a little and see what each company is offering as per your individual situation, be it age or income or location or anything else. Remember that you don’t need to buy too much and that if a group rate is available, you should take advantage.

Take note of different kinds of insurance.

You should also keep in mind that in the above text I am referring to term life insurance. However, it is plausible that term life insurance may not be accessible and so you will have to resort to whole life or guaranteed issue life insurance; and should that be the case, you should be prepared.

I would consider purchasing a whole life policy that doesn’t heavily rely on large cash values. This way, you are essentially creating a unique, personal, term life policy. However, you may also want to consider guaranteed issue life insurance.

Mostly anyone can purchase this sort of plan no matter their health or age. However, this open admission implies strings attached, and there certainly are strings attached. One, the coverage itself is usually not the best. Two, it generally only pays out to 100,000$. Not to mention, you have to survive 2 or 3 years for the policy to take effect while you’re paying significant premiums in the meantime.

Regardless of what you decide, I hope this helps in your quest through the complicated and treacherous waters of attaining life insurance. Good luck and godspeed!

 

from Robert Taurosa http://ift.tt/1Qsdews

Secrets to Inexpensive Insurance: Senior Edition

How Far, Really, Can A Car Go on One Charge?

In a world increasingly conscious of the environment, electric vehicles have been at the helm of cutting down fossil fuels. You would think, considering how surrounded we are by climate change’s harsh realities, we would be jumping at the prospect of electronic vehicles that do not spout pollution into our already tainted atmosphere. However, the numbers don’t reflect that. In fact, the percentage of new car sales in 2015 being directed to electronic vehicles was less than one percent. Astounding, but understandable when you look at electronic vehicles in a side-by-side comparison with their internal combustion brothers and sisters. Perhaps the most significant question that is raised out of such a comparison, is how far can an electronic car go on “one tank,” or rather, one charge. Here are three of the most popular electric vehicles and the range they boast:

Chevy Volt (53 Miles)

With a fully charged battery, the Chevy Volt claims to be able to travel a full range of 53 solely electric miles. While certainly a considerable distance, it seems this range would be best reserved for merely traveling to and from work. For any individual considering an interstate, or even an international, trip, the Chevy Volt is not a viable choice. While of course, interstate travel is surely not the deciding factor when purchasing an automobile, it is a factor nonetheless; and the fact that the Chevy Volt is one of the longer lasting batteries presents a problem to a mass consumer migration to EV’s.

Tesla Model S (270 Miles)

This sporty sedan not only beckons customers forth with its hit aerodynamic aesthetic, but also draws them in with a larger, 270 mile range. This increase in range decreases the new phenomenon known as “range anxiety,” all the while boasting a more than capable engine with a body that makes heads turn. However, there is a catch, the price. At 85,000$, the Tesla Model S is not necessarily a budget vehicle.

Chevy Spark (82 Miles)

This remarkably small vehicle boasts 82 miles on a single charge and only costs 25,170$, a huge reduction when compared with the Tesla. Of course, the aesthetics and performance of the Spark do not quite match that of Tesla, as I imagine is expected. At 128 miles per gallon in the city, the Spark’s gas reduction perfomance is unparalleled. For comparison, the Tesla sits at 95/mpg city.

 

Palm Tree

 

 

from Robert Taurosa Auto http://ift.tt/1PO9pp2
via IFTTT

How Far, Really, Can A Car Go on One Charge?

Insurance Tips

When choosing the perfect life insurance plan, there are dozens of factors to consider. Beyond the weight of determining how your family will be cared for after your passing, you’d do well to avoid these pitfalls when choosing plans and assigning beneficiaries. And please, when in doubt, don’t hesitate to contact a professional. It’s their job to know the inner-workings of the life insurance industry, not yours.

 

Never Name A Child: Though your children are likely the first thing that leap to mind when you think of protecting your future, be sure not to overstep and name them in your Will. Not only is it irresponsible to put the weight of shouldering this burden on a child, they aren’t legally able to receive the money until they are of age. Even so, there are countless horror stories of wealth being squandered by children too irresponsible to save. Imagine inheriting $78,000 from a parents life insurance, blowing it on a sports car, and then having it stolen in one week. Seem too wrong to believe? Well, it happened.

Avoid Group Insurance: While the idea of saving some spare bucks is enough to turn anyone’s attention, I suggest that you avoid going in on life insurance offered by our company. The times have taught us that job turnover is rapid, and the job you have today may be gone like a wisp of smoke tomorrow, taking your life insurance with it. Instead of banking on working where you currently are for the rest of your life, why not invest in a personal policy? That way, regardless of what happens, you’re protected.Robert Taurosa

Living Benefits: When choosing a policy, I suggest you pick one that offers living benefits. Whether you need the money to help afford a medical bill or minor expense, most modern policies offer an option to draw money from your healthy policy for expenses while you’re breathing enough to use it.

from Robert Taurosa http://ift.tt/1SgBJTN

Insurance Tips

Future Cars Pt 2

The realm of street-legal speed is a hotly contested one. Car companies will push the boundary as far as possible, squeezing more horsepower and shaving seconds off their 0-60 runs. This lRobert Taurosaatest entry in the world’s fastest car will surely run you a pretty penny, for both the price tag and any possible incursions with the law your joyriding might earn.

The current holder of the fastest production car is the Bugatti Veyron. The 16.4 Super Sport “World Record Edition,” is capable of some pretty astounding speeds. In a long enough stretch, this car can reach up to 270 mph. Capable of going 0-60 in 2 seconds, this speed demon will have you around the block and back seconds after the light turns green.

Though reaching the top-speed would prove difficult on any normal road, all the discerning driver would need is a rented landing strip. Considering the cost of this car, renting such a lavish speed strip should be a pittance. Just pushing the envelope on what it is to be street legal, the geniuses at Bugatti know speed, and know that their clientele expect it.

So, why? Why get a car so fast that you’d need specific situations to see what it’s capable of? The experience has been likened to riding in a space ship. The smooth curves of the interior match the wind-slicing body design, each bend meant to evoke a feeling of motion. This is more than a vehicle, it’s speed incarnate. Though the price may be steep for some, many would leap at the chance to sit behind the steering wheel for just a few minutes of uninhibited driving.

from Robert Taurosa Auto http://ift.tt/1TrPy0z
via IFTTT

Future Cars Pt 2