In Managing Life Events

As you have probably noticed, inflation affects everything. It hits us at the most basic level of our necessities. Simple grocery store runs to a routine check-up for your vehicle are directly impacted by inflation. This is caused by a variety of reasons, from the current labor and supply chain issues to foreign affairs. 


When it costs even more just to eat for the day or week, you can imagine that these kinds of costs continue to escalate as more and more businesses raise prices to try to ensure they meet their own profit percentage bottom-lines. But how does inflation affect your life insurance and your future investments?


During times of inflation, prices rise and there is an increased amount of money supply in circulation, meaning the value of our currency lowers. There are many theories as to why this happens, but the end result is everything costs more. This impacts everyone, especially the working class, but there are ways we can combat inflation and secure our investments for our future beneficiaries.


Inflation and market downturns directly affect your 401k and Roth IRA, and right now everyone’s retirement plans are taking that hit. It’s important to account for increasing prices in your long-term savings strategy to make sure your investments will be there for your loved ones and dependents. A smart way to accommodate for this negative impact on your 401k account balance is to purchase additional term life insurance to offset the reduction in value of your overall retirement savings plan.   


Not sure where to start? It’s easy to get a clear estimate with our Insurance Calculator. With this invaluable tool, you are able to break down your life insurance needs with four easy steps: 


  1. How much annual income is needed (pre-tax)?
  2. How long will beneficiaries/dependents need this income?
  3. What interest rate % can you earn on invested proceeds?
  4. Factor inflation rate.  


The Insurance Calculator is a great tool to give you a clearer picture of how much term life insurance is appropriate based on your overall financial picture. Term life insurance is the simplest form of life insurance, and is designed to replace your income in the event of your premature passing. The ultimate goal is to self-insure this risk. In other words, once you have plenty of money in the bank, no debt and your children are grown, why do you need life insurance then? If you are over the age of 70, you most likely no longer need life insurance as a part of your overall financial plan. Taking into account the impact inflation has on your overall financial plan including your life insurance portfolio is a wise decision to make.     

Get started today with the Insurance Calculator, and when you’re ready to discuss further, the team at Low Cost Life Insurance is happy to help. Let us help you make the best decisions for your family’s future.

life insuranceman and women in front of computer and scattered papers with looks of frustration