I am going to tell you why life insurance is important to me.
I have two children from my first marriage. They are 13 and 16.
The first time I was approached about life insurance, I was pregnant with my first child. The guy who was selling me the policy was doing it as his side hustle. He was actually the Spanish teacher at the school I taught at. Pregnant women must have been a demographic they taught their sales reps to pursue- because as soon as I started showing, he started hinting about how my husband and I needed to get life insurance in order to make sure that our unborn child was taken care of if one of us died. I was hesitant because I was only 23 at the time, had just gotten my first “real” job, was barely married, and my husband was still in college. I felt like “life insurance” was such an “adult” thing. But, I guess, so was having a baby. It was time to grow up.
Because you just never know. We could be driving down the road and get into a car crash.
We could be biking on the side of the road or walking in a cross walk and have someone hit us accidentally. (Or on purpose, I suppose…)
We could get cancer. We could have a stroke or a heart attack.
I could die during childbirth.
He really scared me with all of the possibilities. He would put Post It notes on my desk at work with statistics and scary notes. Like one day I walked into my classroom and there was a note that said “Do it now. You could get hit by a bus tomorrow.” It was like some creepy fortune cookie.
Okay, fine. He wore me down.
My husband and I sat down with him and he sold us both small term life policies. He had to ask us a bunch of personal questions (Do we do drugs? Do we have HIV? Things like that.) And then he scheduled a nurse to come out to the apartment to take a vial of blood and some pee.
Since we were both 22 and the worst thing wrong with us (other than my completely normal pregnancy) was my husband’s horrible seasonal allergies and really bad reaction to bee stings- our policies were both really inexpensive. My first term policy would have paid out $258,000 if I would have died and I think it cost me about $16/month. That was a 20 year term policy- which means that our rate was locked in. At the time, we picked a 20 year term- because we figured that our kid would be 20 by the time the policy ended and he or she would be old enough that if I died, they wouldn’t need my payout!
Fast forward 3 years and I was pregnant again. My husband had completed his bachelor’s degree, secured himself a full-time teaching job, and we had just purchased a house. I was teaching at a new school and it would seem… my husband and I were growing up. I was now 26 and about to have two children to take care of.
My parents had a family friend who specialized in selling life insurance (meaning- that was his full-time job) and had heard from my parents circle of friends that we had just purchased a house. He called and asked if I would be open to a life insurance review.
The last thing in the world I wanted to do was sit down with this kind of stranger and talk about life insurance. Why did we need to review life insurance? I was 26 and I HAD life insurance. I was probably more responsible than 99% of 26 year olds. Wasn’t I?
Out of politeness, I forced my husband to sit with me at this meeting- where I was shown how now that we were going to have two children, we should reevaluate what we would need. We went through a needs assessment and calculated things like how much I would need if my husband died to:
- Pay for his funeral
- Pay for the bills that his income usually took care of (his half of the mortgage, the cell phone bill and the cable bill)
- The extra cost for health insurance- because his paycheck to care of it. We would have to switch it to mine, which would make my paychecks less. If my paychecks were less, I would have less money to pay the bills.
- That’s not even taking into account helping the kids with their future
Previously- we didn’t have a house and we only had one kid. So at the end of the day, we ended up replacing our former policies with new $500,000 policies. We made these 30 year term policies and locked in a rate that was $28/month. I had a little ding in my risk profile because I had gestational diabetes and my pregnancy was trending on the higher risk side at that point, but otherwise we were perfectly healthy. So we made a family commitment to spend about $60/month on life insurance so that we were confident if either one of us went the other one would have the resources to take care of the kids.
Plus- if we were together and we passed away, whomever ended up with the kids would have $1,000,000 to raise our children. Our kids would be able to go wherever they needed to for school. They would be able to get any counseling they needed. And I didn’t have to feel guilty for putting a burden on my sister for taking my children and raising them along with any children she may have in the future because I know she would be able to move into a house that was appropriate, she would always have enough to eat, she would have enough money to pay for daycare and clothes, and anything they needed.
Fast forward again… ten years.
My first marriage ended up crumbling. It was a sad situation- for both the kids and myself. It’s a long story, but my children’s father does not have the mindset of securing financial arrangements for his children- and I have been told that one of the first things he did 9 years ago was cancel the life insurance policy, which means that if he were to die tomorrow; the children would receive nothing further financially from him to assist them in their lives. Their father does not own his own home and leases a truck and therefore does not really have an estate to leave to his heirs.
Even when I was a single mom, struggling hardcore- I kept that life insurance policy. I knew that stopping the payments and then applying for a new one would be more expensive, because I would be older and I knew that I had back issues that may make my price go up. Because I had 100% placement of my young children for 3 years- that life insurance policy became so very important to my sanity- because my entire mantra in life was that I was going to take care of my children- no matter what!
Nothing was going to stop me from taking care of my kids. Even if I was hit by a bus. I would take care of my kids. They- or whomever was taking care of them, would get that $500,000 to take care of them.
Even if it was their father. Whom, at that point in my life- I really hated. But I would have gladly given a half-million if it meant that my babies were taken care of.
Because that is what moms do. They take care of their babies.
I met my current husband and of course my life became easier in a lot of ways once we were married. I was no longer a single mom struggling to take care of the kids all by myself. My husband had three children of his own which meant that we became this big blended family. Our house was hectic and full of love and energy. Those stepchildren of mine became kids I would protect with my life too.
In 2016, when we opened our insurance business- I went through more training on life insurance. I also decided to purchase two more policies.
Why? Because I did another insurance review – this time on myself– and it dawned on me that I have three more children to help support. If I die tomorrow, I have been providing financial resources to not just two children, but five.
I’ve been buying school clothes for five kids. Buying school pictures for five kids. Paying for field trips for five kids. It may all be little things- but they add up. When my oldest stepdaughter got married two years ago- I paid for her photographer, bought her engagement photos, and threw her bridal shower. I “mom” my stepkids too.
I added another $300,000 term policy to my life insurance portfolio. 20 years. And as you would suspect, this one cost quite a bit more. Why? Because I have RA, Fibromyalgia, I’ve had spinal fusion surgery, I’ve had a breast lump removed, and I’m 10 years older than I was the last time. I have more miles on the car. I’m closer to death. I’m more risky. It’s just a fact.
The more likely you are to die, the more expensive you are going to be. If you take the emotion out of it, life insurance becomes simple.
When I hit 56 and 57- the $800,000 in life insurance that I have- it will end. If I’m not dead by then, all of that money I have put into the pot will be “wasted”. I will have paid for a sense of security.
I feel secure. I feel more than secure- at times I feel like a bada$$.
I hope my current husband feels secure too- he knows that if something happens to me, he would be able to pay off the mortgage and no one would have to move if they didn’t want to.
I still don’t like my ex and I wouldn’t want to hand him over a large sum of money. But the money earmarked for my two children will go into a trust so that he doesn’t have control over it, even though he would end up with 100% placement of our children. I know that there will be money for my children to have their needs met.
Lastly- and this is my favorite part- there is an accelerated death benefit on my new policy. This means that if I come down with a terminal illness and have less than a year to live- then I can pull up to 80% of the policy and use it to go on a final hurrah with my family (aka- bucket list). I can also use that money to seek experimental treatment that might not be covered by insurance if I want. If I end up with cancer before I am 57- I am going on one last bucket-list trip!
Everyone has their own reasons for buying life insurance. There are many reasons to buy life insurance- to pay off your debts, to make sure your family doesn’t have to do a Go-Fund me for your funeral, to make sure your home gets paid off if you die, to send your kids to college, to make sure someone will take care of your cat if you die (yes, someone has done this!), to make sure your husband doesn’t buy a mail order bride the first year you are gone, to fund a charity, the possibilities are limitless.
I also hear excuses why people don’t. Usually it’s because they think they can’t afford it.
I think that if people want to buy life insurance- they can figure out a way to afford it. It is usually cheaper than they think. It is just a matter of putting it into perspective.
Life insurance is not for you. Chances are (unless you are using that bucket list endorsement), you will get nothing out of buying life insurance.
Except you will know… absolutely know.. that you are an amazing parent… or spouse… because you took care of business. You “manned up” (as a woman, I hate that phrase, but I couldn’t think of a different one!). You were fierce. You made sure that nothing was going to stand in the way of taking care of your family.
And if you don’t even like your spouse or your children’s parent… get life insurance anyways. I’ve been there. Trust me. Life insurance is not for them. It is for your kids. And if you think your children’s other parent is bat-$hit crazy… then you DEFINITELY need life insurance. Because if you can’t be there for your children, you need to make sure that someone else can be and that they have resources. If you leave them with nothing- you are not taking care of business.
Going back to that very first life insurance salesman in my life.
Do it now… you could get hit by a bus tomorrow.