When it comes to saving money, people may think of anything from stuffing dollar bills into rusty coffee cans to investing in high-risk stocks in hopes for large gains. Before helping your customers open a savings account that only earns 0.25 percent interest at the bank, you should teach them the benefits of making life insurance an essential part of their financial portfolio:
1. Protect a Family
If you’re an insurance agent, you should recognize that you’re not in the sales business, you’re in the people business. Insurance prepares for the worst, protects families and prevents financial ruin.
If your customer has a home mortgage or if they have dependents whom they are financially responsible for, they need life insurance. No matter how good you are at saving, all of that estate money will be taken when there’s food to put on the table and creditors knocking at the door.
Everyone will have to leave a family at some point, but at least you can leave them the gift of security when you’re gone.
2. Maximize Savings Potential
Many people are unknowingly saving in an inefficient manner. Whether they’re overfunding a 401K plan that’ll be taxed later or earning minimal interest in a bank account, there is a better way.
Many permanent life insurance policies include a cash savings plan that guarantees a good rate of return, is available for loans or withdrawals tax-free and if not used, is given to your beneficiary in addition to the policy face value.
3. Continue Providing
The best thing you could do for your family when you’re not there is continue providing for them. Life insurance is the gift that keeps giving. Help your wife and kids with debt, home down payments, college and more by committing to invest in their futures.
4. Pay Death Taxes
Perhaps your customer has built up an inheritance for his children or grandchildren. Large estates are subject to “death taxes,” often eating up hard-earned money. Life insurance is often purchased to cover these taxes so that your money goes where you truly want it to.
We know that a penny saved is a penny earned, and your job is to help individuals and families effectively safeguard those precious cents. Understanding how to use life insurance as an essential tool in risk management can allow you to help your customers. As you focus on the many reasons that a person may want or need life insurance, the law of reciprocity will turn in your favor. Remember that you’re in the people business—it’s a wonderful and enriching duty to carry.
