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Simplicity in Life… and in Life Insurance

[/fusion_text][fusion_text]My sister Kathleen (also an advisor here at Adam Smith Advisors) has been reading a lot about minimalism. She is learning that cutting out a lot of the clutter in life indeed makes you happier. There is a lot to be said for that, within reason of course. At a certain point, things add stress to our lives. They can add a financial burden and/or eat up some of our precious time that we would rather spend doing something else.

Occam’s razor, often used in science, suggests that the simplest solution is the best. That fits in with minimalist lifestyles. It also holds true with life insurance. The more complex a life insurance product gets, the faster you should run away. I estimate that 90% of people can solve their life insurance needs with simple term insurance. You will not hear this from a lot of insurance agents because neither the agents nor the insurance companies make much money on term insurance sales.

Insurance companies have created all sorts of complex products over the years, and all for one reason – to make more money. It is for better marketing, and believe me they are good at marketing. Adding complexity to a product also makes it hard for consumers to assess the true cost.

Term insurance skips all the bells and whistles that come at additional costs. It allows you to share the risk of death with a large pool of people for the time in your life when you need it. Then you stop paying when you don’t need it any more. The cost savings will shock you.

I am a licensed life insurance agent in CA, MN, and TX. I do receive commissions on sales, but I do not make my living that way. Most of my compensation comes from my wealth management advice, freeing me to spend my time advocating for term insurance.[/fusion_text][separator style_type=”single” top_margin=”” bottom_margin=”” sep_color=”” icon=”” width=”” class=”” id=””][fusion_text]

Legal Disclaimer: These posts do not constitute an offer or recommendation to buy or sell any securities or instruments or to participate in any particular investment or trading strategy. They are for informational purposes only. ASA gathers its data from sources it considers reliable. However, ASA makes no express or implied warranties regarding the accuracy of this information or any opinions expressed by the author and may update or change them without prior notification.