Posted by In the previous "American life insurance strategy guide (XNUMX)：Preparation" article,American Life InsuranceThe guide explains that the first problem faced during the insuring phase is not a problem that cannot be achieved, but a related problem caused by information asymmetry.For policyholders at this stage, I have shared 3 empirical principles: LBYB, avoid impulse, and think with common sense.
When the policyholder is ready, the second step is to ask yourself: What are my real needs?In other words, what are American life insurance policies usually used for?Can my goal be achieved?
For most families or individuals,American Life InsuranceThe guide will suggest five common perspectives.
Insuring ideas from the perspective of actual needs can protect the interests of policyholders
Need 1: For the comprehensive protection of the family
Life insurance, like the same name, has the core function of "insurance protection".
OnAmerican Life Insurance GuideOfinsurGuru Life Insurance AcademyHere, we propose that an important criterion for judging this demand is:Does anyone (including yourself) rely on your income to protect his/their (including yourself) financial situation?
The significance of life protection is that when the insured person has an accident that meets the conditions of compensation (including but not limited to: death, major illness, accidental injury, etc.), he can have a sum of money to help himself, his family and the people he depends on. Overcome financial difficulties.
Therefore, if your need is to provide a full range of protection for individuals or families, you should choose a policy product or a product that provides as many protection functions as possible.Rider, Such as covering cancer pay, major illness pay, chronic disease or long-term care pay, etc.If an insurance product also provides more cash value growth strategies to support the overall cost of the insurance policy, it is also a priority.
Need 2: In order to get tax-free lifetime income after retirement
Compared with 60 years ago, the average life expectancy of American men has increased by 9 years, reaching 2016 years in 79.The average life expectancy of American women has increased by 7 years, and in 2016 the average life expectancy was 86 years.Therefore, the problem that modern people face when they retire has become, in the longer and longer life span, how to ensure that they always have money to spend?And no more taxes?
life insuranceThe cash value account is the top three tax exemption alongside Roth IRA, government or national bondsRetirement planningOne of the options, if our needs areSupplementary retirement plan, If you get tax-free lifetime income, the earlier you invest in special savings, the better.
If the applicant is looking for this, it should choose a product design that focuses on the growth of cash value and provides an excellent growth strategy.
The cost of higher education may be a big high expenditure for American families in the future
Need 3: In order to pay for the child's future tuition
The Chinese community has always been willing to spend money on children’s education, but the traditional government education account project has a single function and the amount is not enough to spend. In the column "List of Children's Dollar Education Fund Plans" as well as"Comparison of the advantages and disadvantages of 529 education savings plan and life insurance policy education plan"There is a specific analysis and comparison in the article. ForHigher education tuition that is bound to continue to rise, The general principle is "Planning First"Plan your savings as soon as possible.
Cash value life insurance policies are often usedChild Education Savings Plan, To achieve the goal of flexible control: If children can get a full scholarship, at this time, the insurance policy account originally used for tuition expenditure can be turned into an account that provides living expenses for the children.Children can also choose to inherit the policy directly after they reach adulthood and plan again for the future according to their own supplementary retirement plan.
If the applicant’s goal is to provide minor childrenEducation accountProducts, or financial planning for a lifetime, so choose products as early as possible and lock in premiums as soon as possible are the key points of planning.
Need 4: "guaranteed income" or "guaranteed" long-term financial planning
Products such as CD and Bond in the market are generally considered to be very safe financial management options, but the disadvantage is that they are not directly linked to the market and have low yields.
Different types of life insurance products provide "Guarantee" or "Floor" promises to the cash value of the policy.
For "guaranteed income"Participating products, Give a fixed rate of return slightly higher than CD, Bond, and give annual dividends1.
For those emphasizing "guarantee"Index products, Linked to the market index.Taking the US S&P 500 Index as an example, looking back over the past 90 years, its average annual total return rate was 9.8%.Through the design of a specific insurance policy plan, when the actual market is in line with the expected trend, the cost can be quickly recovered, and the advantages of following the market to follow the rise and not follow the fall will continue to be locked, and both "guarantee" and "income" can be taken into account2.
For families that have made short-term and medium-term financial planning and are still relatively well-funded, life insurance policies are a long-term, low-risk dollar financial choice.
Actual operational needs in the process of wealth transfer
Need 5: Reasonable tax avoidance and property transfer
When policyholders are considering leaving an inheritance for their children, a life insurance policy is a better option than a deposit account, not just from a tax perspective.On this topic, we will give a detailed case description in a future column.
At the same time, in terms of the legal procedures for the transfer of large inheritance, if you purchase a real estate in the United States as a foreigner, you will usually purchase a life insurance policy, leaving your children with tax-free claims to hedge against high inheritance taxes.
In practice, the federal and state inheritance taxes must be paid within 9 months, and the money after tax must be used.Life insurance companies can complete the payment within one month, provide tax-free cash, and provide this large amount of liquid capital.
summary
Professional brokers or financial advisors will help guide policyholders to clarify their insurance goals.After clarifying the actual needs, then the next step is the most important link-choosing the policy design plan.
In the following"American Life Insurance Strategy Guide (XNUMX): Misunderstandings"In this article, the American Life Insurance Guide will explain the importance of insurance policy design, and use cases to illustrate the most common insurance misunderstandings.
1 Dividend (Dividend), it is based on the financial situation of the financial insurance company, which is unilaterally determined by the insurance company on a yearly basis.There is no guarantee whether there will be dividends or how many dividends will be distributed.
2 Earnings (Credit interest rate), the amount of earnings and the rate of return are not guaranteed, it is determined based on the rise and fall of the actual market index.Funds are not actually invested in the market.
