40% of people die with less than 10K in assets

[97guns]

just heard this stat on a financial talk show i listen to every week.

[disneysteve]

Jeffrey posted this a few days ago:

http://www.savingadvice.com/forums/personal-finance-news-articles-blog-posts/68124-fifty-percent-americans-die-almost-no-money.html

[greenskeeper]

can't take it with you

[UnknownXV]

Dying with no money does not bother me. I just don't want to live without any.

[AccountantSalary]

I'm on track for that. I don't plan on leaving anything behind when I'm gone (except maybe a little for my pyramid )

[asmom]

You don't need it if you're dead.

[asmom]

Dying with no money does not bother me. I just don't want to live without any.

yeah, that.

[UnknownXV]

An addendum to my post, having money when you die is important if you still have kids or a wife you want to leave money to after passing.

[disneysteve]

An addendum to my post, having money when you die is important if you still have kids or a wife you want to leave money to after passing.

That's what life insurance is for. If you have people who are dependent on your income, you either need sufficient insurance to provide for them if you die or sufficient wealth to do the same.

[UnknownXV]

Does life insurance apply if you die of natural causes? That's the type of death I was thinking about here.

[riverwed070707]

Does life insurance apply if you die of natural causes? That's the type of death I was thinking about here.

Of course it does, it just gets signifcantly more expensive as you age because your likelyhood of natural causes increases. If someone has a heart attack at 40 its not any less natural than someone having a heart attack at 75 -- its just more common. The goal should be to have insurance if your expenses exceed your assets. Once the scale tips the other way you don't need insurance anymore, you are self-insured so to speak.

[UnknownXV]

That's surprising, since it guarantees anyone on life insurance will eventually get a payout. The prices must be incredibly high to get it then, or else I can't see insurance companies making much profit since payouts are usually six figures aren't they? Even at $200 a month, someone would have to pay the insurance company for 500 months just for them to break even on a 100k payout.

[greenskeeper]

UnknownXV

There is a set length of time in a life insurance agreement. If you out-live the policy you get nothing and the insurance company has made money on your premium each month by investing it.

The older you are the higher the premium since odds of death are higher. FWIW we have a $500K policy for both myself and spouse, as well as $25k policy for both our children. Total monthly premium? $79.79/month

However, there are a few policies (I have one for myself and spouse) that pay you back all of the premiums if you out-live the policy. We got this back when the economy was humming along....I doubt that option exists anymore.

[UnknownXV]

I am just confused how they are making a profit.. it doesn't really seem like a good gamble to me, honestly, considering how people live. It's scarily easy to die.

[parafly]

I am just confused how they are making a profit.. it doesn't really seem like a good gamble to me, honestly, considering how people live. It's scarily easy to die.

I am not in the life insurance business, but I would assume they make most of their profits through investment/interest and a sizable number of customers cancel their policies without ever making a claim.