As I mentioned in my previous post, my father's passing was left us in a lurch. It wasn't sudden or unexpected, as he had been suffering from the effect of Parkinson's Disease for years. And even though I have been a life and health agent for years, he ignored any of my pleas to let me take a look at what he had in place.
His beneficiaries were horribly out of date. Yet he managed to keep these policies up to date, either paid up or still making premium payments. Always trying to impress us with his financial intelligence, he screwed up when it came to something simple like life insurance.
And worse, he put his family, my sister and I, in a situation that needs to be cleaned up. I can foresee myself spending hours on the phone with these carriers trying to sort out death claims that will be paid to his estate. At this point we would be satisfied to cover his funeral costs. (Did I mention he had an equity line on the house that he was using to pay his monthly bills? Another surprise!)
But what if he had died 40 years ago? His insufficiently low face amounts would have probably forced us to move from our home. College would have been a "maybe" for me. My mother, who was a great home maker but had few marketable skills, probably would have been forced to enter the job market.
Life insurance agents sometimes get a bad reputation. I get it. However, the vast majority of us are genuinely concerned for our clients. We know that people have budgets, yet they also have families who will be in trouble in someone dies too soon. The question to ask yourself if this: If I were to die tomorrow, will my family be okay?
Even though my sister and I are adults and have our own families, we never expected to be on the hook for my father's final expenses. Nor did we think we would be having to sort out a tangled web of life policies. The main problem was lack of communication. My father dismissed our entreaties to go over his finances. We weren't vultures waiting for him to pass to inherit his vast empire. But we did want to be aware of potential landmines that could have been eliminated. Now we are dealing with those landmines.
The moral of the story is as follows. Let your life insurance agent help you. Take into account final expenses and the "cost of dying", as well as any outstanding debts. And even though we hear horrible stories in the news concerning elder abuse and financial fraud, most adult children are caring and should be trusted.
Chris Castanes is the president of Surf Financial Brokers, as well as a professional speaker helping sales people be more productive and efficient.