There are many amazing family stories and then there is the story of the family I met a week ago. I had to try real hard not to get tears in my eyes listening to their story.
I met them at their home in south Dallas, during what I thought it would be just another appointment. The dad, in his late twenties, mom in the early thirties. Mom opened the door to me, standing tall and smiling on her two prosthetic legs. She walked me in, to meet her husband who was waiting for me by the kitchen table, in his wheelchair. By now I knew this was going to be a very interesting appointment.
After getting to know them better and learning their story, I was so proud and jealous of these two wonderful, strong people. They were both victims of car accidents who met during the time of their physical therapy. The lady, lost her spouse in the accident and was left to raise her then five-year old daughter all alone. This couple had a six-month old baby of their own. What a strange twist of fate for two people to meet under such devastating circumstances. Two car accidents, at different places at different times, that eventually brought them together. This couple really understood the value of life insurance, since the mom was left with almost nothing after her previous mate passed away. It wasn’t long before I found out during the discovery part of my work, that neither of them was insurable due the medical conditions that followed their injuries. What these two brave people really wanted to do was to give their children what they could not give to each other. They wanted to make sure their kids and especially their kids’ kids would not have to deal with the same financial nightmare they had to deal with. Long story short, they insured both their now seven-year old and the baby, with policies that covered them for life, no matter what life brings to them. They also planned so their kids will have enough funds for college, and plenty for their later years and for when they grow old enough to retire. And of course all these benefits will be tax-free when it is time to use them. They also made sure they chose a policy that offers living benefits, in case their kids experience health issues that require large amounts of money. They know how it is to be severely injured, out of work and with very little income.
So let’s see what they did for their kids.
First, they decided to invest in their little baby $350 per month until their baby was 18 years old on her way to college. The death benefit for that policy is $1.8M (that’s million). At that time, they stopped putting any money in that policy. The result?
Their child has enough savings build in to take out $15000 per year for years during her college. Then at age 30 she can get out about $50K for a down payment for a new home. At age 40, she can pull out another $50K for a vacation home for her family. When she gets to age 50, she can pull out around $50k per year for 4 years to send her own two kids to college. At age 65 if she decides to retire, she has about $1 million which keeps on growing. And of course, there is still a death benefit of about $2M available. Also, our favorite couple, will eventually retire. So when dad gets to be 65, he can withdraw from that same policy about $25K every year for 30 years. And all that because he cared enough to invest 350 a month for a total of $75,600.
For their 7-year old daughter, he invested $250/mo for the first 11 years and then (since he stopped paying for the baby’s policy) he upped it to $600/mo for the next 7 years. Total output will be $83,400 for the older daughter, with pretty much the same benefits throughout her life and about $1M in death benefit.
That is the power of life insurance when it is executed correctly.