Part 5 is Here! Again , you definitely need to check out Part 1 , Part 2, Part 3 and Part 4. They are all Essential in you seeing how understanding money in your life , and how to obtain, create and use it effectively will make the “money issue” in your life a non Issue. When this happens, you’ll get on to really focusing on your life and your time, the ultimate commodity.
Insurance is only Known for In Case Shit happens. Even then most of us are Under Insured or Uninformed.
The famous Comedian Chris Rock said that he calls Insurance “In Case Shit happens.” in the same bit he asks a very Valid question. “In case nothing happens, shouldn’t I get my Money back?”. For most people, insurance is only known as money you pay up front and policies you purchase in prevention or coverage for shitty things that can happen in life such as lawsuit, theft , fire, illness, death, etc. While that is indeed the primary objective of insurance in all of it’s various forms, there are aspects that some forms of insurance can work for you beyond that. In other words, Insurance Premiums don’t have to be just expenses, they can actually become another set of asset for you. Let me cover some of the basics and then, let me propose something you may not have thought of.
Asset and Property Insurance
Asset and Property Insurance is what most of us are the familiar with. For a monthly premium, you get coverage that protects you from huge and unexpected financial damages related to your home, car, any property or physical business asset you may have. It is definitely about purchasing the peace of mind in an unpredictable world. Most of these are required to have by law so they become necessary even beyond just being practical necessary purchase. I really hope its not a requirement for me to express how important it is in having solid Home, Auto and Asset Insurance.
Health and Supplemental Insurance
Health Insurance is just as Essential as Home, Auto, and Asset Insurance. The challenge is, premiums are escalating and unfortunately making more people decide life decisions in living with or without proper coverage, and managing the health issues they may have. With this, and the reduced negative credit affects in medical bill reporting, many people are electing to pass on having health coverage and taking their chances. This may not have immediate consequences, you can still get treatment. However, in the context of your financial life , it can serve to take away opportunities for future financial moves or make them more difficult especially if Credit is involved. In other words, you may get by with having your health needs met, but the financial destruction coming after that may still affect your health through stress based issues from financial issues. You may have to work harder to make payments for home or vehicle, and now you are caught in a health and finance trap! The game in indeed cold. Strive to have and keep affordable healthcare insurance in your life.
Health insurance only covers hospital expenses, hospital treatments and stays. But , life outside of the Hospital Goes on, and the longer you stay, the more you pay, both inside and outside the hospital. This is what makes Supplemental insurance essential, you don’t want hospital stays killing your cash reserves (see Part 3) , so it makes sense to pay it forward with a policy to reduce risk of that happening. Supplemental Insurance stabilizes your regular life, while you are trying to get back to it, which again promotes peace of mind, and hopefully quicker personal and financial recovery. The great thing too, is it’s relatively cheap, just check in with a certain Insurance company known for a mascot duck that gets into all kinds of crazy insurance essential situations.
Life Insurance…more than just for Death?
You Bet! You can LIVE your life insurance! How? I will break it down soon. In short, life insurance is a policy you pay throughout life that provides a proportionally high death benefit to your designated beneficiaries or institutions when you pass. On the surface, it sounds like a very morbid thing to pay for, but if done a certain way, it can benefit you while you live, and your circle when you pass.
Life Insurance comes in 2 basic forms, permanent, and term. There’s alot of different varieties under this but in short, permanent is life long (as long as you pay the premium), and term ends at a certain amount of years. Term is generally Cheaper and can provide larger death benefits relatively. Permanent , has a higher premium, but provides a means for you to accrue a cash value , based purely as cash or indexed to some financial asset like stock or mutual funds for growth. Both are Great , although depending on what each agent is selling you, you will be told that one policy is inferior to the other. I would say that Permanent Policies, namely a Brand of Whole Life, Dividend Paying Insurance is the most flexible of the policies and becomes an excellent foundation for not just your Life insurance but, your other insurance policies as well. When structured properly , much of the premium you pay into such a policy instantly becomes cash value that you can borrow against your policy to do WHATEVER you want. At the end of the year in these policies, you get a dividend from proceeds the Insurance companies make in investing the cash values that often are not used by the other policy holders. So what does this mean for you , why is this Cool? Read on ..
Synergizing your Insurance…What?!
I was very brief in describing the benefits in Whole life, Dividend paying, cash value insurance and how the policy can be used as you live. The thing about this one particular attribute is you have the flexibility to use it as you please, which means you can do clever things like recapture the premium payments of your other policies by using this one policy or a set of theses policies (you can have a series of these). You can start to become a Self-Funding person through your insurance. So an awesome Idea would be to pay your premiums with the cash value of your policy , buy additional term or whole life coverage with that cash value. Doing this reverses the money going out of your financial life back to you. Another cool thing you can do is finance car purchases, and pay yourself the interest you would pay the traditional banks over the same amortized time. As you reach Baller status , you can lend to others like a bank , to finance cars, homes, small businesses, the options are a broad as your thinking. Big Banks Themselves Incvest into these policies and they are actually considered top tiered assets (Google BOLI). Do you see now how you can turn Insurance expenses into assets? Definitely check with an EXPERIENCED (10+ years in the game) Insurance Agent and ask for Dividend Paying, Whole Life Insurance, with a Cash Value Component . Make sure you don’t have them get you confused with Universal Life, which is cool, but not as Flexible.
ARE YOU SEEING THE BIG PICTURE?
In this part of the Series, I hope I have been able to make you aware of how you can make Insurance coverage an Asset in your life, something that not only can give you peace of mind but can also produce or preserve money for you as you pay into it. The name of the game is to structure money handling in your life in ways that can preserve and produce your money to achieve the lifestyle you want, and you want to keep finding ways that can promote the circulation of that money in your personal economic system, therefore enhancing your life and health, with less direct activity and time.
The next Section will be about the Power of Giving and Putting yourself in a position to practice the power of giving to promote the right kind of money circulation in your life as well as to empower movements and agendas in culture to influence the environment you desire to live in. I’m personally excited about that! Stay Tuned!