We would love to hear from you. Click on the ‘Contact Us’ link to the right and choose your favorite way to reach-out!

wscdsdc

media/speaking contact

Jamie Johnson

business contact

Victoria Peterson

Contact Us

855.ask.wink

Close [x]
pattern

Industry News

Categories

  • Industry Articles (21,155)
  • Industry Conferences (2)
  • Industry Job Openings (35)
  • Moore on the Market (414)
  • Negative Media (144)
  • Positive Media (73)
  • Sheryl's Articles (800)
  • Wink's Articles (353)
  • Wink's Inside Story (274)
  • Wink's Press Releases (123)
  • Blog Archives

  • March 2024
  • February 2024
  • January 2024
  • December 2023
  • November 2023
  • October 2023
  • September 2023
  • August 2023
  • July 2023
  • June 2023
  • May 2023
  • April 2023
  • March 2023
  • February 2023
  • January 2023
  • December 2022
  • November 2022
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • December 2019
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • April 2019
  • March 2019
  • February 2019
  • January 2019
  • December 2018
  • November 2018
  • October 2018
  • September 2018
  • August 2018
  • July 2018
  • June 2018
  • May 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • December 2017
  • November 2017
  • October 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • March 2016
  • February 2016
  • January 2016
  • December 2015
  • November 2015
  • October 2015
  • September 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015
  • March 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014
  • August 2014
  • July 2014
  • June 2014
  • May 2014
  • April 2014
  • March 2014
  • February 2014
  • January 2014
  • December 2013
  • November 2013
  • October 2013
  • September 2013
  • August 2013
  • July 2013
  • June 2013
  • May 2013
  • April 2013
  • March 2013
  • February 2013
  • January 2013
  • December 2012
  • November 2012
  • October 2012
  • September 2012
  • August 2012
  • July 2012
  • June 2012
  • May 2012
  • April 2012
  • March 2012
  • February 2012
  • January 2012
  • December 2011
  • November 2011
  • October 2011
  • September 2011
  • August 2011
  • July 2011
  • June 2011
  • May 2011
  • April 2011
  • March 2011
  • February 2011
  • January 2011
  • December 2010
  • November 2010
  • October 2010
  • September 2010
  • August 2010
  • July 2010
  • June 2010
  • May 2010
  • April 2010
  • March 2010
  • February 2010
  • January 2010
  • December 2009
  • November 2009
  • October 2009
  • August 2009
  • June 2009
  • May 2009
  • April 2009
  • March 2009
  • November 2008
  • September 2008
  • May 2008
  • February 2008
  • August 2006
  • Gen X Seriously Short On Life Insurance

    September 12, 2013 by Jeff Reeves, Special for USA TODAY

    In the wake of the 2008 financial crisis, middle-aged Americans are increasingly overlooking life insurance due to shaky personal finances.

    A New York Life survey released Thursday shows Americans born from 1965 through 1976, commonly known as Generation X, reported life insurance needs almost$449,000 greater than what their current coverage provides.

    And that’s just the typical gap. According to New York Life, 20% of Gen Xers reported zero life insurance coverage. That’s up from just 5% with no coverage in a similar 2008 survey.

    “When you’re hurting for every discretionary dollar, this is one thing people can justify (cutting),” said Chris Blunt, president of the insurance group at New York Life.

    A survey of 1,000 Americans ages 37 to 48 reported median coverage of just$260,000 vs. a self-reported need of$708,996 — a difference of$448,996. That gap is up about 24% from a similar study in 2008 that showed a self-reported shortfall of about$363,000.

    Blunt noted that it’s not just a decline in policies that helped the gap grow so much in just five years. People have fewer resources, in general, to fall back on, which naturally leaves them more exposed should the unexpected happen.

    “During the Great Recession, people’s homes got creamed, the stock market got hammered,” he said. “If your financial assets are down, almost by definition your insurance gap has gone up because that’s part of the calculation.”

    Taking a big risk

    Blunt said that while a shortfall is typical between self-reported needs and self-reported coverage, the size of the gap New York Life uncovered was alarming.

    “As a rule, most of us weren’t as focused on life insurance when we were younger. That’s natural, normal psychology,” he said. But, he said, it’s very risky to fall so short of your family’s true life insurance needs.

    Ted Bovard, managing director at Fort Pitt Capital Group, a wealth management firm in Pittsburgh with$1.4 billion in assets under management, says it’s “universally true” that families underestimate what they need in insurance. And he adds that the median coverage of$260,000 reported in the New York Life survey isn’t even close to adequate for most families.

    “You have a mortgage for you and your wife; you have your own college loans that still exist because you can’t seem to get out of school now without some serious college loans; and on top of that you’ve got two small kids,” Bovard said. “It adds up in a hurry.”

    But most people don’t bother to do the math, Bovard said, because it’s uncomfortable to dwell on issues like mortality or bad financial decisions, such as credit card debt or an underwater mortgage.

    Beyond the bills, it’s also important to look at lost income. Larry Rosenthal, president of Rosenthal Wealth Management Group outside of Washington, D.C., and a financial adviser with two decades of experience, says the right coverage can easily top$1 million for a middle-class family.

    This is especially true for Generation Xers, who are in their peak earning years.

    “As a rule of thumb, at a minimum you need to have five to 10 times your income in life insurance for most Americans out there,” Rosenthal said. So, if you and your spouse collectively make in excess of$100,000 a year as a pair, he notes, a million-dollar policy may not even be enough.

    Getting the right policy for you

    If your ideal coverage plan is out of reach because times are tight, there are still options. The bottom line is that some kind of life insurance is always better than nothing.

    “Do whatever you can do; do whatever you can afford,” said Blunt of New York Life.

    It pays to start looking sooner rather than later, he adds. Rates are lower the younger and healthier you are, so it can save you big money to lock in a long-term policy in your 30s.

    “It’s ironic that when the most you need (life insurance), the least psychologically attuned you are to getting it,” Blunt said.

    One place to start is through a group plan at your workplace, because these plans can be very affordable. The downside is that frequently benefits are small, and policies are only good for as long as you work for that specific employer.

    That’s why Bovard of Fort Pitt Capital advocates starting with basic term life insurance — that is, a locked-in monthly payment that gives your family a fixed benefit across a fixed time frame should you die. It’s easy to understand, Bovard said, and is cheap for Generation Xers in good health.

    “Younger people, particularly if they are married and have children, simply need to have insurance,” Bovard said. “And about 90% of the time, that should be term insurance.”

    If you’re looking for insurance that will retain some value even if you have the good fortune to live a long and healthy life, Rosenthal said, there are some good alternatives to term life that can be very attractive.

    “When you look at whole life or universal life or variable life, the advantage there is forced savings that builds up equity inside it and grows up tax-deferred and you can take out a loan if need be tax free as long as the policy stays in force,” Rosenthal said.

    While he admitted these can sometimes be a bit more expensive or complicated, Rosenthal said that if you do your homework or talk with an adviser you can easily ensure your policy doesn’t get loaded with hidden fees or interest. And the bottom line is that if you don’t really understand life insurance or what your family needs, the best policy is to sit down with a financial planner to hash things out.

    “For people trying to do this on their own, there’s a lot of nuance,” Blunt said. “If you simplify it to something someone can do in 12 minutes on a website, something gets lost.”

    Jeff Reeves is the editor of InvestorPlace.com and the author ofThe Frugal Investor’s Guide to Finding Great Stocks.

    Originally Posted at InsuranceNewsNet.com on September 12, 2013 by Jeff Reeves, Special for USA TODAY.

    Categories: Industry Articles
    currency