10-31-2019 Columns

Millennials may need to boost life insurance

If you’re a millennial – born between 1981 and 1996 – you’re either in the very early or relatively early stages of your career, and as the old song goes, you’ve got a lot of living to do. Still, it’s not too soon to think about a financial issue you may have overlooked: the need for life insurance. Regarding this topic, millennials need to ask three key questions: When should I purchase insurance? The answer to this question depends somewhat on your stage of millennial-ism. If you’re a young millennial, perhaps just out of college, single, and living in an apartment, your need for life insurance may not be that great. After all, you may well have other, more pressing financial needs, such as paying off your student loans. But if you’re an older millennial, and you’ve got a mortgage, a spouse and – especially – children, then you unquestionably need insurance, because you’ve got a lot to protect. How much do I need? Millennials who own life insurance have, on average, $100,000 in coverage, according to New York Life’s 2018 Life Insurance Gap Survey. But that same survey found that millennials themselves reported they need coverage worth about $450,000, leaving an insurance deficit of approximately $350,000. That’s a pretty big gap, but of course, these figures are averages and may not apply to your situation. Still, you should know how much insurance you require. You might have heard that you need life insurance worth about seven or eight times your annual salary. And while this isn’t a terrible estimate, it doesn’t apply to everyone, because everyone’s situation is different. A financial professional can look at various factors – your age, your marital status, number of children, size of mortgage, etc. – to help you arrive at an appropriate level of coverage. Keep in mind, also, that your employer may offer life insurance as an employee benefit. However, it might be insufficient for your needs, especially if you have a family, and it will probably end if you leave your job. What type of life insurance should I get? Many people initially find life insurance to be confusing, but there are basically two types: term and permanent. As its name suggests, term insurance covers a given time period, such as 10 or 15 years, and provides only a death benefit. It’s generally quite affordable, especially when you’re young and healthy. Permanent insurance, on the other hand, offers a death benefit and a savings component that allows you to build cash value. Consequently, the premiums are higher than those of term insurance. Again, a financial professional can help you determine which type of insurance is most appropriate for your needs. Thus far, we’ve only been talking about life insurance. But you may also need other types of protection, such as disability insurance, which can replace part of your income should you become ill or incapacitated. And you may eventually want to explore long-term care insurance, which can help cover you for the enormous costs of an extended nursing home stay. You should at least consider all forms of insurance as part of your overall financial strategy. The future is unknowable – and as a millennial, you’ve got plenty of future ahead of you. This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Defending school safety

On Sept. 30, Gov. Whitmer slashed millions of dollars from critical government services in an attempt to chastise the Legislature for refusing to include her unrealistic 45-cent gas tax increase in the budget. Instead, she’s hurt some of our most vulnerable citizens with her vindictive actions. One of her cuts targeted school safety grants intended to help keep our students and teachers safe. I’m truly surprised that our governor didn’t see the magnitude of the need for these grants. As a parent and a teacher, I understand just how important it is that every child feel safe going to school each day and that every parent have peace of mind sending them there. This funding could have been used for much needed panic alert systems, intercom systems, secure locks and doorways, security cameras, shatter-resistant windows, and two-way radios, among other security upgrades. Schools would also have had the option to utilize a statewide panic button app. This cut was a significant misstep by the governor and I’ve introduced a plan to fully restore the funding that she eliminated. The legislation is currently under consideration by the House Appropriations Committee as we try to work with the governor to ensure she will not funnel this and other important funding into her own personal priorities, which she did with over $600 million originally intended to go towards programs such as Jobs for Michigan Graduates and local bridge repairs. I urge the governor to reconsider her decision to cut this program and support school safety when the legislation crosses her desk. Other essential programs and services she cut include: PFAS remediation, county veteran services, sheriff road patrols, career technical education equipment, resources for children with autism, critical access hospitals, rural access hospitals, newborn health care, summer school reading programs, and Michigan tuition grants. She calls these funding measures “pork projects,” implying they are unnecessary and frivolous. I couldn’t disagree more. As always, please do not hesitate to contact my office with any questions or concerns. You can reach me at 1-800-577-6212, via email at BethGriffin@house.mi.gov and on facebook.com/RepBethGriffin.

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