209. If you Died Tomorrow Would Your Family be Financially Okay?

What would happen financially to your family if you died tomorrow?

In this episode of the Money & Legacy Podcast, Laura Sexton breaks down why term life insurance is one of the simplest ways to protect the people you love. From replacing income and covering childcare to protecting stay-at-home parents and making sure your family knows where to find important financial information, this episode is all about preparing well before a crisis happens.

Laura explains who needs term life insurance, how to think about the amount of coverage your family may need, why stay-at-home parents should not be overlooked, and why life insurance is only one piece of a larger legacy plan. She also shares why protecting your family means leaving both money and information behind.

In this episode, you’ll learn:

• Why term life insurance matters for families
• Who should consider life insurance coverage
• Why stay-at-home parents have significant financial value
• How to think through the amount of coverage your family needs
• Why beneficiaries and policy details need to stay updated
• How your life insurance fits into your larger financial legacy
• Why your family needs access to passwords, wills, budgets, insurance information, and household details

Your family should not have to grieve and figure out your entire financial life at the same time.

Download Laura’s free Legacy Binder to organize your insurance information, wills, passwords, budgets, home maintenance details, and everything your loved ones may need in one place.

LEGACY BINDER

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Transcript

Audio Only - All Participants-57 0:00

A former client reached out to me recently after his mom passed away. We haven't worked together in about a year, but he suddenly had an inheritance to think through, and he reached out to ask what I thought he should do. It got me thinking about something we do not talk enough about, and so I adjusted, in real time to change what we were going to talk about today, to something that people really need to discuss. The people we love have to deal with our money without us there to answer questions, and one of the simplest ways to protect them is term life insurance. So today I wanna talk about what term life insurance actually does, who needs it, and why it belongs in your legacy plan

Laura 0:44

You are listening to the Money and Legacy Podcast with Laura Sexton. I'm helping families pay off debt, grow wealth, and build a legacy without sacrificing what matters most. This is where money feels easy.

Audio Only - All Participants-57 0:58

Hey, legacy builders. Today we're talking about life insurance. Now, I was incredibly, incredibly touched when a former client reached out to me after his mother passed away. And I really just wanted to be able to sit with him for a few minutes. So I asked about his mom and then we decided what we were going to do with the money that she left behind. Now, this is a beautiful blessing, and whether or not that money came from insurance or investments or wherever it came from, I thought, "You know what? My legacy builders need to hear about life insurance, and we need to talk about it," because the worst thing you can do is leave your family grieving and broke. So I want to make sure that you are able to leave a financial legacy as well as the habits and mindset and tools that you leave behind. Okay? So today we're gonna talk about life insurance, because life insurance is not about you. I know, crazy, right? If you take a policy out on you, you think you're the beneficiary. Nope. It's for the people who would financially feel your absence, the people that are left behind when you pass away, because we don't get out of this alive, guys. We don't. Like it or not, in the end, we will all pass away. So what we want to do is make sure that should our passing come in an untimely manner, we are able to make sure that the people that we love have an income so they can cover things like mortgage and childcare and food and school and transportation and daily life, like, all of the things. Grief is hard enough. Your family does not need a financial emergency on top of it. If your income is going to disappear, we need to make sure that we can replace it. Now, the goal of term life insurance is not to make your family rich when you die. The goal is to keep your death from financially devastating them. If you are the primary breadwinner in your family, this is something you need to do right now. Pause this episode... Well, let's talk about it first, but when we get to the end of the episode, you're gonna want to go and find life insurance that fits your needs and the specifications that we are going to talk about Now, why I'm being very hard on this is because your family, your grieving widow, your grieving children do not need to worry about having to figure out how they're going to come up with an income. Your term life insurance is simple protection for a set time period that will cover anything that they need. Now, I really like having term life insurance be 10 to 15 years. My husband and I got 15-year term. We are probably, because we did just buy a house, we're probably going to lengthen that or get new insurance when he does fully retire. It's funny because he's older, ten years older, and his insurance will go down because he'll no longer be doing dangerous work. Term life insurance is actually relatively cheap, and that's one of the reasons why we go with term life insurance. If you get whole life insurance, I have a whole issue with whole life insurance. But when you get whole life insurance, ninety-five percent of the money that you put in goes towards premiums, fees, things that do not benefit you at all, at least for the first five years. Ninety-five percent of what you put in does not benefit you in any shape at all for the first five years, and after that, the majority of what you're paying is not actually a benefit to you. My husband has a million-dollar policy, works a dangerous job, and we pay less than seventy dollars a month. I have a three hundred and fifty thousand dollar policy. I am in my mid-thirties, and I pay eleven dollars a month. If you are paying considerably more than that, and you are not obese, and you do not smoke, we need to talk about it. So term life insurance is simple protection for a set period of time. You get to choose the coverage. You choose the term. You pay the premium. If you die while the policy is active, your beneficiaries receive the death benefit. If it is designed for the years when people are most dependent on you and you don't pass away during that time, you just paid for insurance, like car insurance. I hope that you never need your car insurance, but you're still gonna pay those premiums every month to make sure that should something happen, you and your family are covered. It's just like health insurance. I pray that we never need to use those big deductibles, but you wanna make sure that you have the coverage should you need it. Life insurance is the same way. Now, let's talk about when you do not need life insurance. If you can self-insure, having over a million dollars in the bank And your family is able to, access those funds. So not necessarily a million dollars in retirement, not a million dollars in your checking account, but you have a million dollars in a brokerage fund, something that you can get to that's liquid or can be easily liquidated. We don't want it to be tied up. So I don't want to get too in the weeds on this, and I apologize if I get a little distracted because I'm so passionate about this. You are renting protection during the years that your family needs it most. And you want to make sure if you have young kids in the house, you should have term life insurance. Even if you have two, three, $4 million liquid cash, go ahead and do it. It does not cost that much. What we pay for in life insurance every month, my family spends more than that going out to eat, and we have over a million dollars in coverage in case something ever happened. My kids are going to be well taken care of But I also need you to hear this and hear it very pointedly. I have term life insurance, and I had it even as a stay-at-home parent. When I didn't have a job and I didn't work I got term life insurance because stay-at-home parents have to be replaced as well if something happens to them. That means you're gonna need a nanny, a car driver, a cook, a house cleaner. All of the roles that the stay-at-home parent does has to be picked up by somebody, and if one of you has to be at work, who's gonna pick that up? If you were the breadwinner, we need to make sure that you are making 10 to 12 times your income in term life insurance so we can take that money, invest it in the stock market that has an average rate of return of 10 to 12% And you want to put that in the stock market and then be able to draw down the interest so that you are bringing in the same amount of money that you would have been making throughout the year. If you have young children, this is just something to go ahead and do. But let me tell you who it's not for. It's not for those people that are retired, that have no children that they need to take care of financially. Do not pay premiums on life insurance if you don't have anybody that is dependent upon your income So who needs this? Anybody that has somebody that would feel their absence financially. If you are the breadwinner, a stay-at-home parent, if you have a spouse, if you have young children, anyone whose death would create a financial burden for someone else, that's a person that needs term life insurance. Your income is not the only thing with financial value, so do not forget the stay-at-home parent. How much coverage? I think you need to know what the money actually needs to accomplish. It needs to replace your income, but it could also do other things. Now, I never recommend getting gimmick insurance, so things like mortgage insurance, unless you can't get term life insurance for some reason. Mortgage insurance is guaranteed issue, and if you can't get life insurance, I would go ahead and get that because then your mortgage is paid off in the event of your death. We want to make sure that your income is replaced so that childcare can be covered, so that their education can be covered, your final expenses are covered. If you are solo and you don't have anyone dependent on you financially, but you could get a small policy of $15,000 to cover all of your final expenses, that'd be great. That would be a great gift to give the other people in your life that do love you but are not financially dependent upon your income. We want to make sure that we are giving the people that you love breathing room so that they can grieve and not have to wonder how they're going to eat tomorrow. Start with what your family needs, not what you would like to give them and not what someone wants to sell you When I say that, a lot of people come to me and they're like, "Hey, I was talking to this investment person and they're trying to sell me whole life insurance." They're not an investment person, they're a whole life salesman. Totally different things. So this is not a whole life strategy that I'm giving you. This is a term life strategy. And this policy, which I want you to go get, if you do not have term life insurance, I really want you to go get it. I use a company called Zander Insurance. It's zander.com I think will get you there, Z-A-N-D-E-R. And I'm not sponsored by them. I wish I was. I just, that's help- what I use and what I give to all of my clients and what I let my mother use. And so I wanna make sure that you are using good resources. They are a broker. They will shop a ton of different companies and show you the best deal. You don't necessarily wanna take the cheapest one, but you do wanna make sure that you are locking in all of your options. They will walk with you through making a decision as well. So, you know, again, not sponsored, wish I was. But this policy is not the whole plan. This is just where legacy planning comes in, where we're just trying to make sure that we're covering them in the immediate. But imagine you have life insurance, but nobody knows where the policy is. Nobody knows how to get in touch with the insurance company. Nobody knows your passwords. Nobody knows where your will is. Nobody knows how the household bills get paid because everybody knows you take care of it so they don't have to worry about it. Okay, if nobody knows where anything is, you're missing a huge piece of the protection. Protection is not just about leaving money, it's also about leaving information. This is exactly why I created my legacy binder. It's a free-to-you tool. You just wanna go get my checklist to make sure that you have a one place for all of your insurance information, your wills, your passwords, your budgets, your home maintenance information. Any kind of important financial detail that you have, you wanna make sure it's all in one place. That way, someone that needs to come in and figure out your life can just go to one place, one binder. A three-inch binder will hold all of this, and say, "This is where everything I need to handle my friend or my spouse's or my family's entire plan, it's all right here." All you have to do, scroll down in the show notes, click Legacy Binder, it's all right there. Or go to my website accelerateyourlegacy.com/resources. It's there. It's free. You don't have to pay anything. You just have to put in an email address, and it will email it right over to you So before you go on with your day, I want you to do two things. First, check your life insurance. Do you have it? Is it enough? Who are the beneficiaries? If you have not changed your beneficiaries on your life insurance since you've been married, divorced, had children, we have to do this, because guess what? If you accidentally give the money to your ex-wife, your new wife and your children get nothing. Make sure that you change your beneficiaries. Figure out when the term ends. You don't wanna be left out in the cold and go, "Oh, I still needed that. I wish we had taken the time." It does not take a lot of time. Go ahead and do it. Let's look over this as part of your financial strategy. Again, term life insurance, level term life insurance. Then scroll down in the show notes, download my legacy binder. Start filling it in. Start adding to it. It's going to cost you $5 to go down to Walmart and pick up a three-inch binder. Fill it in. Do not wait until this is perfect. Start gathering the important information, put it all into one place, and let the people that you love know where it is so they're not left guessing. And then when my emails show up in your inbox, read them. I'm gonna keep helping you get your money organized, protect your family, build a legacy that actually makes life easier for the people that you love. I promise, that is what I do all day, every day. I want to make sure that you are able to leave a legacy, a financial legacy, a legacy of love and care, and people are going to know that you care because you took the time to put all of this together to make their life easier when you are gone. None of this is gonna matter to you when you're gone because you're gone, but the people that love and care for you are going to be grieving, and you are going to make their life so much simpler by going ahead and handling this for them. Term life insurance is one of the simplest ways to protect the people you love, and what I have heard John Delony say over and over and over again, he says, "The only reason to not have life insurance and a will is if you hate your spouse and children." The real legacy is making sure that they're not left with grief and financial chaos at the same time. Protect them. Go ahead and organize this information. Make the plan easier to use. You can do that by downloading the legacy binder. It's really simple, just a couple clicks. And then what I want you to do, my friends, is go out and make a difference.