Tuesday, September 27, 2011

Life Insurance

Ok So I am in my 30s now.  (31 if you are counting) That means I am getting old right?  Some days I feel old, some days I feel like a spring chicken.  Spring Chicken?  Why do people even say that?  Wouldn't it be spring chick if it was a new little baby?  Anyway.  I guess now is the time to start thinking about Life Insurance. 

I contemplate life a lot now that I am a Mom.  I didn't bother thinking about it too much before.  I am a Christian, I believe in heaven, when it is my time to die, so be it.  Great right?  Well that has all changed since having my boys.  Now there is a future when I am gone that I need to think about.  What would happen if I was no longer here?  Ok maybe things would be fine since Scott would still be around, he is the breadwinner anyway.  (At least until my imaginary bakery or amazing crafting empire take off.)  So lets imagine what would happen if something happened to Scott. 

BOOM!  The Dallas Center Carnival rides truck was driving on Highway 44 and the tilt a whirl car flew off the truck and struck Scott as he was mowing our ditch.  (Hun - if you are reading this you totally died quickly and painlessly.)  If we have no Life Insurance what would happen? 

Well first off, there would be funeral costs to take care of.  The average funeral is $15K.  Yes 15 THOUSAND.  That is a lot of money to say good bye to someone.  If we had no life insurance what would we do?  My dream of a nice casket and lots of flowers would be out the window.  Gone also the beautiful plot of land overlooking the flower filled hill side.  The ornate headstone with "loving husband and father" NOPE.  The reception with amazing chocolate cake and a keg?  Well maybe we can keep that one.  In all seriousness I don't have money tucked away for funeral costs and the money that we do have "tucked away" we have other plans for.

Next we would probably loose our home.  Good thing that we bit the bullet and got a van this year.  Guess we could find a river...  Maybe that is not exactly what our only option would be but we would definitely have to downsize.  We don't need as much room as we have and if you know me you know that I have no desire to mow our large yard.   We never planed to leave the home we are in now.  We have worked very hard to make it our dream house and I look forward to seeing all the family milestones and traditions continue in our home. 

Like I mentioned Scott is the breadwinner here.  He has worked incredibly hard to build Gustafson Insurance Team from the ground up and I would have a huge decision to make if he headed up to chill with Jesus.  Do I sell GIT?  Do I just hand his company - our company - over to someone else?  All of the hard work and amazingly long hours he puts into it would be for nothing.  Or do I work my bootie off to try to be Scott 2.0 and try to figure out how to become the Insurance Guru that he is.  It would mean incredibly long hours away from the kids, and lots of focus and attention to my clients.  Right now it works out great that we work as a team and I think that our Insurance customers benefit from that, I am not sure I could do it by myself. 

What about the college funds for our children that we have not started yet?  (Opps.  Maybe the next Blog should be about savings.)  If we didn't have life insurance where would any money come from to be put toward schooling?  (On a side note -the college that Scott went to is about $39,000 a year this year.  Can you imagine what it will be in 15 years?)  Or what about car payments?  Credit Card Bills?  Anything else that isn't payed off?  What about the trip to Italy I have planned for 2013? 

Yes - I get it.  No Life Insurance would not be good.  So I solved that problem for everyone.  Should you get Life Insurance?  Yes.  Great.  But now we have another question.  How much? 

Ugh.  Isn't this blog long enough?  OK, how much, should be a little easier of a question to answer.  Let's just look back at our "problems."  Do you need funeral costs to be covered?  Yes, ok write 15K down.  Do you own a home?  OK write down your mortgage because you want to provide your family with a debt free home.  Anyone in your home with plans to go to college?  add those up.  What about vehicle loans, credit card debt, any other loans you have out?  The hard one is thinking about the loss of income - the general rule is 8-10 times the primary wage-earners salary.  Oh and one not every family may have to think about but we sure do - Any family members that have long term medical care needs?  OK did you come up with a figure?  Your insurance agent can definitely help you to figure out what would be a good figure based on your needs but it is obviously better to err on the side of too much coverage then not enough.   

I hope that in reading this you understand how important life insurance is to you and your family.  You have to remember that your families future standard of living could greatly change if you don't have a plan in place if something were to happen.  It is never fun to think about death and lack of money.  Having the conversation with your family about what would happen if you were gone is not a pleasant thing.  Not having the conversation and ending up wishing you did would be far worse. 

OK now off to go hug my husband and tell him that he is not allowed to mow in the ditches around Dallas Center Fall Festival time.  You always hear about those crazy "jinx" stories.  Good Bye for now!