Rethinking Insurance

Contemplating on buying insurance has been a confusing tug-and-pull for me. I have been setting this task aside because somehow it does not add up. My reservations on this matter can be greatly attributed to the lack of experts I can consult with, who is not trying to sell me a policy. I even encountered a seemingly harmless insurance interview that turned into a high pressure sales situation.

I am most skeptical about insurance policies being packaged as an investment instrument, a wealth plan of sorts. For me, the goal of life insurance is to makes sure that I can still afford day to day expenses in my old age, when I’m no longer able to work, and that I do not have to burden family members with expenses to be incurred in my death. Suffice to say, I do not expect any insurance policy to make me rich in my retirement. I think that requires a different strategy.

Given my financial situation, it makes more sense to me to pay off my credit card debts first and invest regularly in uitfs before I dive head first into insurance. Credit card debts accumulate higher interest rates the longer I have it. I figured I might be able to make room for life insurance by the start of 2014.

The reason life insurance got sudden urgency in my thoughts is because of time. I would like to consider getting one now while I’m in my 20s and premiums are much lower. It also occured to me that I might need life insurance at this stage in my life when I’m investing for my future. In my mind and my heart, I still believe I’m going to be a financial success someday. I know that saving up for retirement or a life insurance will not make me rich. It is my financial education and building a business that will bring me to financial freedom.

Without a true expert’s opinion on this, I have to rely on what feels right and hope that my gut feel is correct as usual. I wonder what the likes of Kiyosaki, Trump, and Buffett has to say about this? Do they own a life insurance policy?

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