gmhTODAY 15 gmhToday July Aug 2017 | Page 29

FINANCIALLY
Speaking
Going Solo:
Protecting Your Family
When You Have to Go it Alone
W
1.
Jeffrey M. Orth is a
Chartered Financial
Consultant, a Certified
Advisor in Senior Living,
and an Investment Advisor
Representative, with over
15 years of experience as
a business and personal
planning, insurance,
and wealth management
specialist. Jeff is available
for group lectures and
private consultations. Visit
ifitfinancial.com or call
408.842.2716.
158285ORM-Sep18
hile meeting with a female
client recently, it occurred to
me that, I serve a number of
women, like her, who are the
sole providers for a child or children. We all
know that it’s never been easy raising a child
by yourself, and single moms often face special
fi nancial challenges, which add to their worries
about what would happen to their children if,
for some reason, they were no longer around to
care for them. It’s a valid concern, and one that
too often gets overlooked amidst the struggle to
just get through each day.
According to singlemon.com (February,
2005), nearly four in ten single parents do
not have life insurance. Of those who do have
coverage, nearly two-thirds do not believe it
is adequate, and they are probably right. The
typical single-parent household owns just
$60,000 in coverage—hardly enough to pay
family expenses for a year, let alone the almost
$290,000 it takes to provide basic necessities
for a child from birth to age eighteen. (Source:
2006 USDA Report “Expenditures on Children
by Families”).
If you’re among the many single parents
who feel they need more protection, but aren’t
sure where to begin, take heart. You do have
options! But before you go out and buy an
insurance policy, there are a number of factors
you should consider first, including:
The needs and expenses you are trying to
cover, such as funding your children’s higher
education expenses if you’re not here; paying
for funeral expenses and any related medical
costs; paying off debt, including your mortgage;
providing income for a child with special needs;
or if you don’t die prematurely, supplementing
your own retirement income.
How much premium can you afford?
It makes no sense to purchase a policy that
exceeds your monthly budget.
The length of time you will need your
coverage. Term policies, for example, which are
generally the least expensive, provide coverage
for a specific number of years only—usually 1, 5,
10, 15, or 20 years. Term policies do not build
cash values, and when the term period expires,
it can be prohibitively expensive to maintain the
coverage. Permanent (or “Whole Life”) policies,
on the other hand, provide protection for life,
but they are also more expensive. Permanent
policies build cash values which can be borrowed
against to help fund planned expenses such as
college costs, or to supplement other sources of
retirement income. *
Some advisors say you should own an
amount of coverage equal to ten times your
annual income, but that doesn’t always hold
true, especially for single parents. Your needs
and income are likely to change over the
years and with life events, such as the birth of
another child, the purchase of a new home, or
perhaps a promotion at work, could change
your circumstances. For that reason, you might
want to consider a policy that gives you the
flexibility to increase or decrease both your
coverage amount, and premium, as your needs
and cash flow situation changes. Universal Life
policies provide this kind of flexibility.
When it comes to protecting yourself, your
loved ones, and your future financial security,
there is simply no substitute for life insurance.
For just pennies on the dollar, life insurance
provides the foundation on which your dreams,
and your dreams for your children, can be
built—especially if you can’t be there to build
them yourself.
*Accessing cash values may result in surrender fees and charges, may require additional premium payment
to maintain coverage, and will reduce the death benefit and policy values.
Registered Representative of, and Securities and Investment Advisory services offered through Homor,
Townsend & Kent, Inc. (HTK).Registered Investment Advisor Member FINRA/SIPC,16845 Von Karman Ave,
Ste. 225 lrvine, CA 92606 [phone]. I Fit is independent of HTK. CA Lic #0C49291 ©2016
The Penn Mutual Life Insurance Company, Philadelphia, PA 19172
GILROY • MORGAN HILL • SAN MARTIN
JULY/AUGUST 2017
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