It’s a New Year and the best time to get your house in order by setting some basic family financial plans in motion. If we focus on one task at a time, your family’s financial footing can be established by February.
Let’s start with life insurance. Ask yourself 3 questions: are you married? Do you have children or other dependents? Are you planning on marriage or children in the near future? If any of those have a “yes” answer, you shouldhave a life insurance policy of some sort. Life insurance really isn’t complicated. Shop around a little bit for a good policy and get one with a 20 or 30 year term (covering the period where you might have children under your roof).
How much should you get? Take the number of people in your household, multiply that by five, then multiply that by your annual salary. Let’s say you have a total of four people in your household, you make $40,000 a year, and you have a net worth of $100,000. Multiply the number of people in your house by five, giving you twenty, and multiply that by your annual salary, giving you $800,000, and subtract your net worth, giving you $700,000. That’s how much your term life insurance benefit should be.
That’s a good way to estimate and will give you a very strong number to ensure the security of your family over the long term.
Next week, we will highlight wills.
Think and do activities that demonstrate your freedom.
This has been our money kingdom financial perspective.
May I AM THAT I AM GOD prosper you.