Saturday, August 01, 2015

Alive or Dead?

As you get older (yes, yes, that "you" is me, too), you become aware that you are crossing any number of inflection points. These are those curious moments in time when you realize that the balance has shifted between what was and what is. Indeed, that's the textbook definition: the point on a graph where the line goes from heading up to heading down, or vice versa. In personal terms it's when you realize you've been out of school longer than you were in, or when you've been married longer then you were single, or when your kids are older than when you had you had them. Speaking for myself, I passed all of those long ago. But without being morbid, I realize that I'm now hitting another milestone of sorts: I think I'm at the point where I'm worth more alive than, well, dead.

We're not talking emotional value here. Like all of you, I'd like to at least think that my presence is worth something to those around me, whether it be family and friends or those with whom I work. No, I'm talking about cold hard cash as determined by insurance, that calculus that says were a piano to drop on my head, or I step in front of a bus, or I go surfing and can't fight the shark off with my fists, that my family will be provided X dollars, assuming there is no piano/bus/shark exclusion in my policy.

That "X" usually starts out as something nice and round. It might be $100,000 or $1,000,000, or some multiple of those. From there it can change based on a variety of factors: the type of insurance, your age when you bought the policy, the premiums you pay, the dividends that the underlying cash might or might not generate, and any loans or advances you might have taken, just to name a few. Put it all together, and you get the size of the check in question when the final reckoning comes. Mind you, YOU don't get it, per se; you're dead. But you get the idea.  

In our case we are in the process of reviewing all we have put in place to see if what we have is right for our situation. We've had our existing policies for years, having bought them back when we started a family. Since we were young and in relatively good health back then, the premiums we locked in were commensurately lower. But like all things, much has changed in insurance, including the way payouts are calculated, various special features available and the like. And so we are looking to see if maybe a newer variant might be a better fit for our needs.  

Just one problem: somewhere along the way we got older. That means we don't look to be quite as good in the long term risk department. And so while we can get new polices, since we are starting from a very different place, the costs are correspondingly higher. Sure they have some riders that are attractive, and there are offsets available based on our existing papers. But it's not as simple as trading up to a new iPhone. The evidence is being presented, and the jury has yet to pronounce a verdict.

Regardless of all that, what strikes me is the how the overall balance has shifted. In the beginning, we had little money, and the insurance was there to protect the family. At that point I was indeed worth far more dead than alive. If I suddenly met my demise, my gang could have afforded a nice vacation a lot easier than if I were standing there trying to pay for it. But I was always confident that my wife indeed loved me, and so I never worried when I went to sleep. Right, Honey? Uh, Honey?

But now it's some decades later, and our big debts of college and mortgage are clear, while our savings have been positioned to grow. My value is to both help to continue to contribute to our nest egg, as well as intelligently manage what we have. That insurance? It's gone from need to have to nice to have. And me? At least from a purely financial standpoint, I actually might be a little more valuable sticking around than not.


Marc Wollin of Bedford always pays his premiums on time. His column appears regularly in The Record-Review, The Scarsdale Inquirer and online at, as well as via Facebook, LinkedIn and Twitter.

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