How life insurance can help build a wealth of generations and pay for major events

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It is calculated that only 51% of Americans have invested in life insurance policies, but this cannot be missed for more reasons than simply providing loved ones after your death. Ryan Smith, Vice President of Atlanta Life Insurance, explained to Yahoo Finance Freestyle A podium is that life insurance is worth the investment, especially when it comes to building a wealth of generations and paying stages for life. (Watch the full episode above; listen only below.)

People often overestimate the cost of life insurance. Approximately 72% of people Think that life insurance policy costs more than it really is. Although premiums vary depending on the conditions of the policy and the holder of the policy holder and the life span, Smith explained that in some cases it is only “the price of one night a month … or a pair of shoes”.

And these relatively small premiums are added. “Every time you pay a premium, you create a value that can win an interest rate,” Smith explained. “And there are a number of ways in which this interest rate can be calculated. If it is a lifetime, it is usually one percent. If it is indexed, it can often be directed to the market,” Smith explained.

Regardless of the interest rate your insurance policy earns, it can eventually become a valuable asset that can be used for other purposes, depending on the conditions.

“While you accumulate this monetary value over time, this is now your asset to do things,” Smith said. “You can withdraw from this and adjust these dollars for other things … Everything from your benefit to death to what I will call a savings vehicle that earns a meaningful rate of return and also has safety and grows in tax.”

Read more: What is life insurance and how does it work?

Smith explained that when used properly, life insurance policy can be used to help pay basic moments such as education or wedding. It can even help start a business.

Animal insurance can also build a wealth of generations. Starting your child’s life insurance policy, while they are young, can set them up for the beginning of their wealth until the age of 18 years.

“If you think about it illustratively, for $ 100 a month, when your child is 18 years old, it can have a $ 300,000 monetary value,” Smith said. “These $ 300,000 can be used to fund education, this can fund their business idea, it can do different things, while it still has this benefit to death. So you guarantee that the transfer of wealth of generations and the continuity of wealth through future generations.”