Cal Commercial Insurance offers a broad array of life insurance products and services from many well-known companies to help you determine your best path forward.
Some of the products we offer include:
• Indexed Universal Life Insurance
• Universal Life Insurance
• Term Life Insurance
• Whole Life Insurance/Final Expense
• Fixed Annuities
• Long Term Care Insurance
• Disability Insurance
Challenges You May Face
There is usually one obstacle or another that gets in the way of planning for your financial future.
Big Debt & Little Savings
Debt, particularly credit card debit, is a big concern for many families. In 2017 the total credit card debt owed by consumers was $931 billion. On average, a household carried $15,983 of this type of debt and those with revolving credit card debt pay $904 in interest per year. Are you concerned about the amount you owe?
Additionally, the personal savings rate – personal savings as a percentage of disposable personal income
– has slipped lower. In March 2017, the rate was 3.9% and as of March 2018 it’s at 3.1 %. Are you’re saving enough?
Without proper planning, paying to send a child to college can put a strain on savings. According to the
College Board, the actual cost a student pays college is usually lower than the per-year prices these institutions publish publicly, which range from more than $9,410 for an in-state student at a public four-year college to slightly more than $32,000 for a private four-year college.
The organization notes that more than half of full-time students pay $11,814 or less per year for tuition and fees thanks to grants, scholarships and other types of financial aid. Remember, though, that tuition and fees are only part of the cost of college. Students also have to pay for housing, food, books, supplies and other expenses.
It’s also important to plan ahead since the price can increase over time. If you currently have a 1-year-old child, and the of cost college increases by only 3% each year, when he/she reaches college age it could cost $148,304 to send them to a 4-year program at an in-state public college or university.
Just 17% of workers feel very confident they will live comfortably in retirement, while 47% are somewhat confident, per the most recent Retirement Confidence Survey. Yet, a large portion of these workers have little to no money savings or investments: 45% report that the total value of their household’s savings and investments, excluding the value of their primary home and any defined benefit plans, is less than $25,000, including 26% who say they have less than $1,000 in savings.
Social Security may not be a reliable source of income in the future. A recent Social Security trustees report noted that the combined trust fund reserves will begin to decline in 2022 until reserves become depleted in 2034. When looked at separately, the Disability Insurance Trust Fund reserves become depleted in 2028 and the Old-Age, Survivors, and Disability Insurance Trust Fund reserves become depleted in 2035.
Rising Cost of Living
Often people fail to consider the rising cost of living when creating a strategy for their future. To show how this can affect you, consider this: If you and your spouse are each 45 years old, earn $100,000 per year and plan to retire in 20 years and inflation averages 4.5% during the next two decades, you will need more than $241,000 a year to equal your current $100,000 annual income.
If you should die unexpectedly, without proper planning that includes life insurance and/or emergency savings, your family could face serious financial issues due to funeral costs, credit card bills, mortgage costs, education tuition and more.
Your Financial Needs Analysis
• Earn additional income
• Manage expenses
• Consolidate debt
• Strive to eliminate debt
• Save at least 3-6 months’ income
• Prepare for unexpected expenses
• Protect against loss of income
• Protect family assets
• Strive to outpace inflation and reduce taxes
• Reduce taxation
• Build a family legacy
When investing, there are certain risks, fees and charges, and limitations that one must take into consideration.
How Much Life Insurance Do You Need?
The amount of life insurance coverage necessary is different for everyone and is based on a variety of factors including your:
• Number of dependents
• Income/current financial situation
Based on these considerations, a basic rule of thumb is to have enough life insurance to provide about 10 times your annual family income. For example, if your current household income is $50,000, you may want to consider having $500,000 in life insurance protection.
But there are many variables that can affect your life insurance needs.
Consider these questions:
• How much long- and/or short-term debt do you have?
• What are your long-term goals?
• How much of the insured’s income will be needed and over how many years?
• How much do you want to set aside for funeral costs and/or an emergency fund?
• What assets do you have that may be able to cover these costs?
To ensure that you have the right type and amount of insurance, make sure to consult with an experienced life insurance professional for a thorough evaluation of your needs.
Areas of Service:
San Juan Capistrano
Los Angeles County
San Bernardino County
“2017 American Household Credit Card Debt Study,” Erin El Issa, NerdWallet.com, https://www.nerdwallet.com/blog/average-credit-carddebt-household/, May 2018.
U.S. Personal Saving Rate, YCharts.com, https://ycharts.com/indicators/personal_saving_rate, May 2018.
“College Costs: FAQs,” The College Board, May 2018.
College Cost Calculator, The College Board.
2018 Retirement Confidence Survey, Employee Benefits Research Institute and Greenwald & Associates, April 24, 2018.
2018 RCS Fact Sheet #3, Preparing For Retirement In America, Employee Benefits Research Institute and Greenwald & Associates, 2018.
The 2017 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds, July 13, 2017.