“In the realm of financial planning, especially for high net worth individuals, the conversation leans towards tax strategies, investment management, and retirement planning. Yet, one crucial pillar frequently overlooked is insurance — a safety net that, albeit less glamorous, is fundamentally essential.” Peter Newman
There are real consequences of delaying life insurance. Its existence is synonymous with death, something most people like to avoid thinking about. But in the words of Jim Morrison, “No one here gets out alive.”
As the marketing director for Peak Wealth Planning, my days are filled with opportunities to educate others on the benefits of smart financial planning. Yet, when it came to certain lessons, I found myself dragging my feet on applying what I learned to my household.
When my son, Sebastian, was born, my husband,Terry, secured life insurance. This gave him peace of mind knowing we would be cared for in the unfortunate scenario where he was no longer with us. When Sebastian turned 3 or 4, Terry began suggesting I also put a policy in place.
Despite Terry's repeated suggestions, I procrastinated until our second pregnancy, which led to a crucial realization about the importance of insurability during life-changing events.
Timing is critical with life insurance.
This situation highlighted a critical lesson about 'insurability.' Factors like age, health, and major life events such as pregnancy can significantly affect the ability to secure favorable insurance terms. For high net worth individuals, timely insurance is essential to protect assets and ensure stability for future generations.
Insurance companies are cautious about issuing policies that could be subject to higher claims shortly after initiation. Waiting until after pregnancy allows the insurer to offer terms that are more aligned with the long-term risk profile of the applicant, ensuring that both the insurer and the insured are adequately protected.
There is a high cost of procrastinating on life insurance.
Delaying insurance can have financially and emotionally devastating consequences. Uninsured events can erode years of careful investment and saving, leaving families vulnerable at the most critical times. I am grateful my pregnancy was low-risk, but each day between being denied insurance and my delivery, I was acutely aware of the potential consequences of my procrastination.
My personal experience underscores that the best time to get insurance is before you feel it is necessary.
Take immediate actions to secure life insurance.
My personal experience attempting to secure life insurance during pregnancy served as a significant wake-up call. It reinforced the understanding that insurance is not merely an option, but a vital necessity for protecting your wealth, legacy, and loved ones.
Here’s how you can take action now:
Evaluate Your Needs: Begin by assessing your financial risks and understanding how life insurance can mitigate them.
Consult with Professionals: Engage with trusted financial advisors and insurance experts who can craft a plan tailored specifically to your needs and circumstances.
Act Promptly: Don’t wait—prioritize securing life insurance early. Make it a foundational element of your financial plan, ensuring you and your family are protected before you ever think it’s necessary.
By taking these steps, you can ensure your financial stability and peace of mind for the future. Don’t put off this critical aspect of financial planning. The right time to act is now.
Expert Insight
High net worth individuals face unique risks that necessitate a strategic approach to insurance. Beyond the basic need for life insurance, considerations for estate taxes, long-term care, and disability become paramount. Insurance, in this context, is not merely about mitigating loss but about caring for family and protecting your legacy.
Are you comfortable with your progress towards retirement? How about helping future generations meet their financial goals? If you have more than $2 million saved and need help from a wealth manager, the Peak Wealth Planning team can assist.
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About the Author
Carmen Egolf is the Marketing Director at Peak Wealth Planning. Her role primarily focuses on educating others about the importance of financial wellness for their future, while also highlighting the expertise of her colleague, Peter. He possesses a deep understanding of financial planning, which Carmen translates into digestible nuggets of knowledge. Their weekly meetings remind her of Tuesdays with Morrie but with a financial wellness twist. By applying Peter's advice to her own life, Carmen enhances her understanding of future preparedness and generates ideas for questions, blog posts, social media posts, and presentations. Ultimately, her work centers on educating others about the benefits of thoughtful financial planning.