Reply: 1
From: Paul Zagoridis
Hi Sue
A good broker is worth it in my opinion. I'm going through the insurance merry-go-round now. So they can clarify the noise. Watch out for inexperienced sales people in bucket shops (often masquerading under the title financial planner). Go to an insurance broker.
I found one on the net that seems ok but haven't had a chance to check him out fully yet. I'll let you know how it goes, unless someone here recommends one.
Insurance it to cover your financial interests in the event of a catastrophe. Most other insurance is a luxury.
If your have income protection and term life, do you really need TPD (Total and Permanent Disability)?
6 to 10 times earnings should allow your dependents to maintain their lifestyle.
I'm aiming at 6 times gross earnings because we have some passive income. It costs a fair bit to earn my income, so expenses will be less. It's probably not enough to fully maintain our lifestyle. But I'm investing the difference in premiums to build more wealth. Nella can go out and work if I shuffle off this mortal coil too soon.
Income protection - I picked 45% as my bare minimum. If I become disabled, we will get by on that, with some chance of new investments. We'll move to a city or town with cheaper cost of living. Ongoing and long-term medical expenses can be high though.
I chose between two options.
1) I can invest heavily now, insure adequately, and pray I don't have a health catastrophe. This creates long term wealth.
2) I can insure myself fully, invest the rest. The best financial outcome for my family in this option is they make a claim soon.
We're going for the long term wealth strategy.
Dreamspinner
