No, we are not talking "rot gut" booze. More later.
This weekend is the last UW-Badger football game at home for the season. God the fall season goes by fast. Weather is predicted to be cool but dry. Michigan coming in is like Darth Vader descending on the Star Troopers. Should be a good game. A plus could be a few Air Force jets flying over since it is Veterans Day on Monday. Add the "Bud" song and you could lose yourself in the excitement.
I also heard that Grasshopper No. 3 took his boat out for maybe the last time this season with a new 300 HP Mercury "hummer" engine. This could take him over the magic 85 mph barrier. He warmed the engine and cruised at lower speeds for awhile. Collin challenged his Dad by saying "lets see what this thing will do"! It went 50, 60, 70, and then easily to 80 mph.
The excitement must have paralleled breaking the sound barrier. Whoops! A sputtering. A dreaded "missing" sound from the engine and then a slow dying growl. Grasshopper No. 3 had a friend in another boat in the area with a video tape recorder. I would guess it is embarassing to be on tape being towed to the boat landing (there was something about sticking up a middle finger). The engine had burnt a cylinder head or something. Hey, the challenge is still there and wait till next year. I know all about engines dying.
Okay, the subject is "rot gut". We are talking about term life insurance protection for a family that is dependent on one person (or two) for major income. The Financial Planning course your Mother and I are taking recommends "buy as much term insurance as you can afford, for as long as you can, at a locked in fixed premium". Imagine losing the major breadwinner in your family without sufficient insurance.
My opinion is you should have a minimum of $500,000 total term insurance. In your 30's and 40's, you can get that kind of insurance for around $300-$400 per year. If the breadwinner dies, $500,000 would be paid out. If your family invests the $500,000 at 5% per year in a safe certificate of deposit, they would get $25,000 per year. That is not a lot per year. It is slightly more than social security. If the family decided to use the $25,000 interest and $15,000 from the principal, they could spend $40,000 per year but after 20 years, the $500,000 would be gone. If you presently have some life insurance, maybe you only need $300,000 term. You get the idea.
The lesson Grasshoppers is that term insurance in an excellent estate planning tool because it is so cheap. They call it "rot gut" insurance because the agent selling it does not make a big commission. It is a good value. You can get competitive quotes "online". Check it out.
Love,
Dad