Listener Question: Life Insurance #032

The finer things in life, right, nerdy board games and good beer. But yeah, so we bought in a duplex and we're really excited about it. It's my first foray into multi family investing. You know, I have three single family homes and now this, and man, you know, you and I we've talked about it multiple times on the podcast already, and uh not to board the heck out of people that don't care about real estate investing. But I'm super pumped about this, and you know, the numbers

work out really good. I've got solid tenants in there. It's a solid house. So the great thing too, I think a lot of people think. And the biggest excuse I hear from people who don't want to start investing in real estate, And by the way, if you don't want to, you don't have to. But the biggest excuse is, oh, man, it's gonna be so much work. And there's ways that you can get into real estate investing where it's not

an overwhelming amount of work from the get go. And and the property I just purchased, even though it's a duplex, it is one of those things it's not necessarily completely turnkey. But man, it's not a whole lot of work from the get go. And I'm kind of all about buying properties that that fit that mold because I still have a full time job, in a family and a life. Right, that's right. You're not gonna have to do much. I mean, the pictures I saw of it, I need to get

down there and see it in person. But the pictures you shared, yeah, like a dope. If I got a vacancy, man, put your name in the hat off consider you have to fill out in that application. I might call your previous lanelords, but I have a feeling you're probably good to go. It's been a minute, but I remember his name Kip all right, I actually remember his last name too, but I'm not gonna say so. You're talking about it not being a lot of work, so certainly it's in

great shape. You're not gonna have to do much for off the bat, Like, what are your thoughts as far as dealing with tenants, because you're going from even though you're only adding a single property, it's got twice as many tenants, right, twice as many potential folks that you're gonna have to be in touch with and here from,

collect rent from that sort of thing. Yes, so that it's definitely been a consideration, and I'm interested to see, you know, how much that increases my workflow on investment properties. I don't think it's going to increase my workflow, you know, at double the rate, because it is still one building, one roof, and and some of those things are in common. But you can get down there once and take care

of multiple problems exactly. So I don't think it's gonna double, but I do think it will increase it, And so I'm really interested to see how, you know, a duplex increases my my workload when it comes to the vestment properties or you know, what maybe just it really doesn't increase that much, and and and so much of it really does come down to the underlying you know, house structure of the house, how good or shape it's in,

you know what repairs. You know, the little things are gonna break, right, like a toilet's gonna need a new flushing mechanism, or your stove's gonna break or whatever, like a fridge is gonna go down. So those things are just gonna happen. But you know, the underlying structure of the house, man, that's so important to how many calls you're gonna get too. So just buying a solid house from the get go with good tenants, I mean that

cures your eels. Yeah, yes, foreside brick, which I'm kind of jealous of because I'm looking We're starting to save up some money for a pain job on our personal house and I'm just not really looking forward to that. Like I'm gonna I'm gonna enjoy it because we get to choose a new color, which is kind of cool, but thinking about wood rot and that kind of thing, I'm just like, I just wish it was made of brick, Like you don't have to worry about that ever again.

But I know, I love the way painted wood signing looks, but it's got that it's got that classic look. It's trade offs for sure. Yeah, but the brick is just there's nothing to worry about really, which is really nice and right off the bat as well, the property meets the one percent rule. We've talked about this before as well, which is awesome, man, especially in this in this kind of market, right, Yeah, so it's tough to find. And you know, there was a question actually on our Facebook group.

One of our listeners wanted to know, Hey, should I should I hold off on buying a house because look at where things are within the housing market. It's it's crazy out there and it is a hot market. And that's definitely true. It's been almost a year since I bought my last house. There are few and far between, right, I'm not ready to buy like five houses a month. I just don't think there are that many good deals.

But I do think there are deals to be found in every market, and so I think it is worth considering if you are interested looking now, and if a house does meet that one percent rule, which is the monthly rent revenue meeting one percent of the cost of the house if you can meet that rule. Man, I think it's a good move in any market to buy a house that meets that rule if it's in good condition and you think you're gonna own it for a

long period of time. So yeah, this duplex for me, meets that one percent rule, and I'm stoked about it. I think this is gonna be a great place for me to own for the long haul. Yeah, man, absolutely, it seems it seems awesome. So kind of on the opposite end of that, or like in the complete opposite direction, getting out we're not spending tons of money on an investment property. We were looking at our budget for the rest of the year, and you know, just kind of

like looking at numbers, dude. We actually did the math on what it takes for us to like feed ourselves, like our family of five, and it only costs us one dollar a meal, dude, per person, one dollar person per meal. That's like the holy grail of eating costs right there. But here's the thing that also includes diapers. Like we don't separate out our actual food from like our grocery runs, right, so like our like our grocery

budget includes like stuff from the pharmacy. I have your profen diapers, trash bags, things like that, just the standards sort of stuff, tooth baste, deodorant, and so in reality, I think we're eating for actually less than a dollar a meal per person. And you might be thinking, we've got little girls. I mean, dott is only one years old. But have you seen her eat? I've seen her belly. Yes,

I'm not kidding. I think Kate and Dottie if you were to way like the actual amount of food that they have, like in a normal meal, like it's just a normal portion. But then Dottie goes and eats an insane amount of food for a one year old, and like you said, it shows dude. That's incredible though, because most people that talk about how much you should spend, you know, on on meals for your family, the patented thought is is that it should be you know, two

bucks a meal. If you can get it down to two bucks a meal per person, you're you're crushing it. So even I even saw something posted where they're talking about five dollars, like five dollars of dinner or like something like that. When sure, if you're going out all the time and you're eating out and you're used to doing drinks and dropping fifty bucks a night on a weekday. Yeah, you're gonna save a lot to it. That five bucks makes it sound like you're warm buffet or something like that.

But that's still a lot compared to our entire family eating for five dollars per meal. Okay, so next episode, can we cover this in detail, because I really do want to get into it. I'm really curious and I think it would help a lot of people out there, like the meal thing. I don't. Here's the thing with Kay. I've talked her about it, and she has more of a philosophy on like the way she approaches food and

the way she cooks. I need to talk to her and see if we can figure out some specific like tips like do this, this is how it'll save like do this, this is how it will safe. Well okay, that's that's your homework for this because because we because like we have to. You can't just tell everyone in the audience like, hey, I we eat for one dollar a meal for our family, and that's breakfast, lunch, and dinner, right because dinner is usually is a lot more expensive

like breakfast. You feel you can get away with it, you know, eggs maybe, you know, probably eggs and toast and some fruit, a little bit of coffee fruit. Yeah, you can get away with it. And lunch easy to write, a little bit easier, maybe a veggie and some nuts or whatever. But dinner, man, how do you get away? Well? See, yeah, you say veggie nuts, and I'm like, yeah, that sounds normal.

But I think for a lot of people they're like, wait, I go out to eat for lunch, you know, like if you're going out to eat, right, that's that's the

biggest thing, all right. But so hopefully if it's not next episode really really soon, we'll could be able to maybe we should just have her on to really be able to explain it, because she really does handle almost of our grocery budget as well as of the cooking, and there's a lot there's a lot of insight there, so do I mean the reason I brought it up was because we're kind of looking at ways to tighten the belt a little bit and I don't think you

can cut there, yeah exactly, And so I was just like, okay, could we go leaner, you know, in our grocery budget? And that's why I sat down and actually did the math and realized, oh, dear lord, no, I don't think we can go I don't think we can like make this any slimmer at all, because I think we're getting into like third world Russia or something, you know, surviving only on like a goat for the years, living in

the year Siberian Wilderness or something. Yeah. Yeah, and we know Kate's got a voice for radio because everyone heard that just a few episodes ago when we had Our wives on, which was really fun. So that was still my favorite episode. I think maybe because they were doing all the talking, we're just sort of like cracking jokes the whole time, a little bit easier just ask them questions, right, Yeah,

that was good. Should we get more into the interview sort of style that maybe that would be if if we're just prepping whoever were gonna have on and they're just gonna answer questions and the whole time we're just kind of like making jokes and drinking beer. That's a good point, you know, that sounds Pretty's pretty nice. I'm really good at cracking jokes and drinking beers. But yeah,

on that note, we'll definitely do something. We do have some interviews planned coming up with some people, so I'm kind of excited to get into into that part of the show. So stay tuned. You know, by the end of the year, we'll have a few interview episodes with people that are experts in certain fields that were not nearly as knowledgeable, and so there should be a learning process for you and I and then also for our

audience at the same time, which is which is fun. Yeah, And like Joel said earlier, we're gonna answer a listener's question. If you have a question, please right in. You can send us a message via the form on our website, Poor Not Poor dot com or just shoot us an

email Poor Not Poor at gmail dot com. We love hearing from all your listeners and whether that means just sort of chiming in with a recent beer find that you've come across in your city or state, but all the way down to specific questions on life insurance like we're gonna talk about today. I've mentioned this before, but having specific questions for us to answer it just feels

like such a tangible way that we're helping folks. Like Granted, I know that every episode we talk about hopefully we're helping people, but to answer a specific question. You feel like the Rubbers actual meeting the road and we're moving somebody forward in their life at least financially, and uh, that makes me feel good. And uh, you know, I know that you feel the same way. But just getting

emails from listeners is man like. It like makes me smile ear to ear when we get an email from a listener and they've learned something, or they have a question or they just want to say hi, and it just feels awesome, like, Okay, hey, we're meeting the people that we're that we're creating this show for and kind of creating this community around and so that's just a blastemy. Only if you start the email with Matt and Joel we love you guys so much. We love the podcast

and we've written reviews. Yeah, or I was like, oh, hey, Matt and Joel hated that last episode that we were just deleted immediately. If that's what happens, I actually delete those from the inbox before you get to them. So oh that's why I'm only happy when I see the emails. Yeah, I'm protecting you, all right. Onto the beer for the day. Uh odd thirteen brewing out of Lafayette, Colorado, And can I say, Matt, I had this a couple of weeks ago, already know I love it, but let's crack it and

have it together. I have missed drinking I p A s. We have had an I PA in a while, and I was especially bummed that we weren't drinking in I p A a couple of weeks ago. On there's all these stupid holidays, but when I saw that it was national I p A Day, I was kind of bombed. I didn't have an I p A Meverridge. That's a poor, not poor fail right there. Although all those holidays they're getting ridiculous. They're out of hand. How many holidays can

there be? And who gets access to create these holidays? It's it's just getting utterly ridiculous. So, without doubt, this is a hazy New England style I p A. It looks awesome and those juicy notes just smack you right in the nose as you open the can. You don't even have to pour it out for to get that. Yeah, it happened. Right when I cracked the can, I could smell it and I started pouring. So we're talking about the visuals here, right, and so the beer almost looks

like orange juice. It's got that nice solid orangey beer color that you see from New England. I p a s. But then, also, do you want to mention the can because this is the sort of most unique looking beer can I think I've ever seen, you know, describe it. Yeah, So author team makes some really good beers, and I've actually really gotten to go to their brewer before, and it's great, and their cans all kind of have like superhero themes, and so this one has like it's straight

up looks like a like a comic book. Yeah, it's just like an alien superhero in some sort of intergalactic intergalactic space space fight laser laser scene. Yeah, so I think he's gonna win and dominate human kind or something like that. But ODS teen seriously makes some of the

best beers I've ever had. I've kind of been obsessed with them ever since my buddy Carl sent me one one beer by them, and actually got this beer from Carl doing a beer trade in person, which, by the way, is the way to go if you're meeting in another city, bring beer trade with somebody and make sure to fly southwest because you get a check bag for free. So that's what I'm talking about. Fly Southwest, make those beer trades happen for frizzle. But this beer is I just

had a sip in dude, incredible. Yeah, this is up there with trillium. This brothers, this is really really good. Man. Let me the best way that these New England styles are described or juicy, like these juicy dry hopped I p A s. I mean, they have a lot of hot presents, but at the same time there they just have a lot of fruit, a lot of fruit notes, a lot of fruit flavors, whereas like the West Coast I p A have those resine kind of piney flavors and this is all happy fruit in your face. Yeah,

this is awesome. I wish I had more of this. Yeah, thanks Carl for doing that beer trade with me. And anybody makes it out to Colorado, there's a bunch of your breweries to visit, but put Odd thirteen on your list because Odd thirteen makes d delicious beers. We're gonna take a quick break, but right after that we're gonna get to Josh's questions about life insurance. So let's get in the topic of the day, Matt, and the question we are answering today is from a listener named Josh

about life insurance. Yeah he read in last week, and his question is I have a fifteen year term policy because my plan is that I will be able to be self insured by two or so when the policy is up. Is that a good move or should I try to get a longer term policy? Also, what age should I make sure I get a policy before? Is there a certain age where if I apply for a policy it will be significantly more expensive or is it all health based? I turned thirty five today, so it

has me thinking about getting old. Well, Josh, uh a late happy birthday to you. I hope it's going well for you man. And yeah, you're old, dude. I mean, I don't know what I would do if I was that old. But also too man, you've got a two million dollar policy. Good for you because that, I mean that tells me you've got uh that you're making a good amount of money, So it didn't come Yeah, man, keep it up, and that you're insuring yourself. Well. So

let's get into the nuts and bolts. I think there are a lot of things to cover in this question, because you know, there's a question of is term life insurance the best way to go? How long should you be insured for? And you know, kind of what what the purpose is. That's kind of one of the questions that he's asking here too, what's the purpose behind term life and how long do I need it for? And so and so let's get into each of those kind

of one by one. We'll kind of walk through with Josh and hopefully you know, have a good answer, you know, not just for your question but for a lot of folks out there listening that are in their twenties and thirties in particular, but even if you're older and you don't have life insurance, these are good questions to wade through to kind of figure out, you know, whether you need life insurance and if you do, what kind of life insurance and how you should go about insuring yourself

and so we'll kind of walk through the process. Yeah, so specifically, Josh asks, is that a good move where you know, should I try to get a longer term policy? You know, he's only got a fifteen year because he's planning to be self insured. He's planning to be essentially financially independent by the time that plan expires, and to that we would say, yeah, man, it's a great move. You know, we don't know what your expenses are, but I assume that two million fits with your lifestyle and

with your income and your expenses um. But in general, having a level term life insurance is the simplest and most affordable way to go. It makes the most sense. You're able to lock in that premium every single month and it's never gonna change. You're gonna pay that for the entire length of that policy. And that's a rarity, you know, it said to know that, like, Okay, this payment is never going to change, and I know that, like if I were to die, you know, pass away early.

This is sort of a morbid topic, right, Yeah, it is. Yeah, I feel like it's worth like mentioned anything. Hey man, we're all gonna die, you know, so, but you know that if if that's gonna you know, if that does happen, that this is how much you'll get you'll get paid out in term life insurance, like you said, is kind of the best way to go because you know how much you're gonna pay over the next fifteen years in

Josh's case, twenty years in my case. But you know, however long of a term you take out, you're paying the same monthly payment every month and no surprises, you lock it in. That's I think it's amazing. And there are other types of insurance, right that can just balloon, or you're insured can tell you, hey, your premiums just are rising for the next year, and they might continue to escalate at a ridiculous rate. But when it comes to term life insurance, you're locked in at the same

rate every year. Good to go. So to give you listeners a feel for, I guess what the average policy out there roughly goes for. If you're if you're a thirty five year old male or female, you're looking at a round paying thirty five a month, and that comes out to about four d and twenty a year for a twenty year term policy for half a million dollars worth of coverage, which is awesome. Yeah, that's great, that's great. Right. Yeah, you know, like think about it, like half a million

dollars and you're paying thirty five bucks. I mean, that's less than the cost of pretty much any utility that you have, you know, that's like a couple of pieces. Yeah, so that's a good number to kind of go on, Uh, you want to find a policy in this price range. If you are thirty five years old, male or female, you're likely going to pay roughly thirty five dollars a month, and that's for non smokers, and that's for nonsmokers, healthy lifestyle. Right.

Then if you wait, if you delay to buy that policy, you we'll talk about this a little bit more further down to you're gonna pay two and a half to four times that much. You know, the older you get, like when you get to age fifty, you're roughly gonna pay two and a half to four times as much. And so yeah, buying your term coverage earlier on in life is a good way to go. It's specifically term life.

You know, there's other insurance products out there. Uh, the most popular, other one that maybe you've heard of, his whole life. We're only are going to talk about term life because for n and a half percent of you

out there, that's the only thing you're gonna want to consider. Ever, and we're not going to spend a whole lot of time on why whole life stinks, but really quickly we will say term life is so much better than a whole life, and it's because term life is really only in actuality a life insurance policy, and whole life insurance

is a combination life insurance policy and investment. And the problem with that is it separating them is the most efficient way to do them, and buying life insurance and an investment at the same time it's just a terrible idea. And the biggest reason is because the commissions are sky high on whole life insurance. Yeah, man, it's right. So anytime you hear somebody trying to sell you whole life, it's because they make a lot of money, a ton of money on that, and they don't make hardly any

money on selling term life policies. And so that's a huge reason that those plans are so aggressively pushed. And yeah, it kind of goes back to knowing where your investments are as well. And when you buy a whole life policy like that, and your funds kind of get commingled with your insurance and you can't really wrap your hands

around it. What's what? Who knows? Yeah, that's not the position that I want to be in when it comes to my investments and looking ahead, And like I did with recently just budgeting, Like you want to be able to look at some solid numbers and know like, this is what we do, this is what we have coming up, this is what we can count on. And when you're co mingling your insurance with investments, I don't like it

just gets it's a harry. Yeah, And you know we're cheap, but we also kind of want the best thing possible, right, And the great thing is you can be cheap and get the best thing possible. So we talked last week just a little bit about these new fidelity investment funds that are zero commission, zero fees, which is amazing. And then these term life policies that we're talking about are almost in the same boat. You know, there's very very

few commissions, very few fees charged on these things. They're both really cheap, but they're also actually the best thing for are you at the same time. So it's just perfect blissful marriage where you if you separate them, you're gonna get the best of both worlds, and if you try to combine them, you're gonna get screwed. You're gonna get in the worst of both words. Exactly. Yeah, So

avoid that. Yeah, and part of Josh's question too, was, you know, I've got this fifteen year policy, whereas a lot of people get a twenty year policy or a thirty year policy. But the reason, and Josh seemed to have a really good reason to get a fifteen year policy, was that he would be self insured fifteen years from now.

And so that brings us to our next point. The whole point of life insurance is to have that insurance until the point that you can be self insured and to replace your income in the case of untimely death. So it's not to have an investment vehicle, and it's not to have this thing that lasts for fourty or fifty years. It is this thing to get you from an insurable need right now until the point that you don't have an insurable need. So I love that Josh,

he's thinking about it in just the right way. Another way to to think about being self insured because that sounds kind of like, well, how do I self insure myself? Like do I have to like write something down on paper? Like No, it's just not like a formal thing or a step that you go through. It's essentially becoming financially independent. And so the amount of money that you have your assets. If all that combined, you're able to you know, if

you stopped working or if you disappeared off the earth. Uh, if you're able to maintain the same amount of cash flower that you were as if you were still working your self insured, you're able to provide that income for your family where you did not be there. And that's what that means. That's all that means. And yeah, and ultimately that means that you need to have a net worth that surpasses probably the value of the policy that

you're in. So in Josh's case, in fifteen years, he wants to seek to have a net worth of two million or more because if he doesn't hit that, if he thinks that's his insurable need right now, and fifteen years from now, it will likely still be his insurable need, right Like, that's how much he's gonna need for his family if he passes away, He's gonna want to have a net worth that's two million dollars or more, you know, by the time that policy expires, so that he doesn't

have to buy another one. So that's how you can know whether you need life insurance or not. Do you have enough sitting there in investments in your bank account, in your overall net worth, that would be equal to or more than the value of the policy that you'd be taking out. And if so, you're self insured, you're good to go. You don't need to buy life insurances. Right Otherwise, just view it as sort of like this gap coverage. It covers between now and until you get

to that point. It's just this in between interim thing. Don't think of it as something that you will always have. So think about it almost like car insurance, right, You're you want to have it around until you know that you could pay out of pocket to replace your vehicle yourself. That's when you would be self insured when it can came to car insurance because that car value will continue to drop. Maybe initially you're like, right when you first get it, you may not be able to cover replacing

that vehicle because you know to in fifteen grand. Maybe you don't necessarily have that sitting around, so you're gonna offer full coverage. As the value of that vehicle continues to drop, you are going to get closer and closer to being able to be self insured. And that's the point at which you want to consider dropping your collision coverage on your currenc. What's the point of having that when you've got that amount of money sitting in the bank where you can go out and buy a car

the very next day. Yeah, because if you're paying an extra six dollars a year, let's say for that collision coverage, but your nine seven day will is worth, you're throwing away money, right, So there's some good calculations that you can run to kind of figure out if you can be self insured when it comes to owning your car. We're not going to go through those right now, but that's just kind of a good example. I think you get to a certain point with your car's value or

it makes sense to not have full coverage. And it's the same thing with life insurance, because you are hoping to build your assets over the life of your term policy and hopefully by the time it expires, you have the hit financial independence or the point where your net worth is worth more than the policy that you took out, and then you don't have any need for it anymore. So, Joel, what about you, guys personally? You want to share what

kind of life insurance you have? Yes, that sweet whole life policy that you have no way man term life all the way. And so yeah, we have a twenty year term policy on both my wife and die and that's for two and fifty thou dollars, which in a perfect world is probably a little bit less than it

should be. But the reason that I felt comfortable getting a smaller term policy than most people should probably get is because of the rental income that we make, right, and so that kind of covers a lot of the monthly costs associated with running our family. And that's why I felt comfortable having just a quarter of a million dollar policy on both my wife and I. I think for most people, you know, making a decent salary, they're probably gonna want to look at a half million dollar

policy minimum. But for us, yeah, we have that that slightly smaller policy that I think still works for our family. Yeah. So I think it's cool that you both have a policy. Is that what you said? You said you and you and Emily both have to fifty yep, And so I think that that's that that's very huge. Yeah, and then that's nice, is what I'm saying, because we don't have that.

Oh really, well, let's say this. I want to ask you about that too, but really quickly for folks that are are married, especially with uh one of the where one of the partners stays at home, I think it's important to kind of discuss how you divvy up life insurance for that. And so some people think that, you know, a stay at home partners shouldn't have as much life insurance or should have no life insurance. And man, I

don't know. I just know that if something were to happen to my wife, right, if the worst thing were to happen, right, she's gone, and I'm left left um with kids and trying to support support our family as a single dad. You want to be able to buy a new wife, right, which is approximately a quarter of a million dollars. Uh No, which hopefully I would not be buying a wife, but uh but I would. I would need to run the house, right, and I would

need to get help. And and Emily doesn't make an income staying at home, but she certainly provides so so much for our family that without her we would be sunk, and and it would cost so much money to to run our house, um without And you know that that annual survey comes out about what a stay at home mom should actually be paid and it's you know, probably accurate in a lot of ways that to grow and grow, right, Yeah, yeah, I mean going back to what we're talking about at

the beginning there, I was talking about how little we're able to spend on our grocery budget every month. I feel like that would immediately double if I was in charge. Can can give so much time to that or and she's got skills, she just knows how to do it.

And again to talking about kids, childcare is expensive and I think for a lot of folks that kind of when it comes down to, if you have a spouse, a non working spouse, you may not need a life insurance policy on them because unfortunately, if if that person were to die, it may not change your expenses that much, right if they're not earning an income. However, kids completely

change that. If if you have kids at home and essentially they're doing a job for free, uh they're not getting paid um you know, monetary wage, and at the same time, they're saving your household a ton of money. And so if you have kids, I think that's definitely a time to consider getting a life insurance policy on

your spouse. For for the spouse that might be staying home. Yeah, the pendulum would shift really quickly, right, You're expenses would go up, and you'd have to also have spend more for childcare, and most likely I'd be working a lot less as well, and so I would see my income probably drop as well because of the added to responsibilities. Not to say that that's not something that you'd want

to do in that situation. Again, these are sad discussions right right right that we're joking about, But at the same time, that's I think, I think that's the truth of it. All Right, So where do your where does your family line up life insurance policy wise? What do you guys got Yeah, so we've got nothing on Kate. Thinking about through this is actually going to probably change that here shortly. Part of me thinks that, like, Okay, I'm just gonna like really buckle down and go crazy

if something were to happen to Kate. But I think that's probably like the last thing that my girls would need. I just want to stop talking about this morbid time. But that being said, so I've got a you also don't know your reaction, right, you don't know your reaction in the case something like that happens, and obviously you're gonna need to take some time, you will probably lose some income, you're gonna be you know, grieving, and so I think, men, yeah, that's that needs to be some time,

the very least completely. So I think, yeah, that's definitely something you need to look into. So what do you have? What we do have is that so I got a twenty five year policy several years ago, um and it was a twenty five year term policy for a half a million dollars and we pay right at four hundred bucks annually. And so I got that when I was pretty young. It was after we had purchased a home, we knew we were going to start a family soon. Is something I kind of wanted to get taken care

of before you're in the haze. You're in the fog for a year with a new baby. And so I'm pretty sure I've got around seventeen years left on that policy, which honestly, I think is like the perfect amount of time for me to be able to self insured. In that period of time, I should be able to be self insured. I should be able to be financially independent, or at the very least, if something were to happen

to me, Kate would be pretty set, you know. Again, like you said, with the income generating assets that we have with the real estate that in conjunction with the sort of lump sum that gets paid out there in an untimely death, I think she'd be fine. We can get to this a little bit later on, but I can get another policy if I wanted to, But I think more of a party might be to go ahead and get Kates on a policy, because yeah, I'm pretty

sure I'm gonna need that help, and Josh didn't. But hopefully he learns from this conversation between you and I that he probably needs to consider, you know, if he's married that he and he would be right if he's if he has a life insurance policy and he's not married, we'll get to business second. As a single person, you don't need to have life insurance, like you're not insuring

for anybody else in all likelihood. But so Josh, you're likely married, if you have kids, you also need to consider getting a policy on your wife, because if you know you were to lose your wife, you run into all these issues that Matt and I are discussing. So it's really important to maybe you need a lesser policy, maybe you need a five dollar or a million dollar

policy on your wife. But maybe instead of getting another policy for yourself, because it sounds like you're in a pretty good position, consider shopping for a policy for her. That'd be the that'd be the thing I would recommend to you right now. Yeah, I like it, And real quick back to you know, the single people. If you are single, living alone, nobody depends on you for income. The income is is ultimately used by you for you. There's no one else that's relying on you in any way,

form or fashion. You don't need life insurance and so you know, I know a lot of single people think that, you know, how do I need life insurns to cover for my funeral or something like that. I mean, in all likelihood hopefully you know a small amount of savings will will cover that. So I wouldn't recommend getting you know, all out term life insurance policy or you're paying a month for you know, a policy that's way bigger just

just for that. Yeah, man, don't worry about it. You know a lot of times people worry too specifically about their debts. No one's gonna get that debt unless someone else's name is on that debt. Right, So, if you have a mortgage, uh, and a partner you know specifically again go back to like a spouse or a partner, but if their name is on that mortgage, then yes,

they're gonna be responsible for them. But if your name is the only name on that mortgage, if your name is the only name on those credit cards or your student loan, if you pass so to those debts, uh, and they just get written off essentially is how it works. So don't worry about that. Don't think that you're parents or you know, your siblings or somebody else is gonna get stuck with that debt. That isn't something that actually happens.

They'll be fine, they'll be sad you're gone. Yeah they will. They will, we all will be. And so so no policy needed unless you have people that depend on you for that income. Okay, so we're gonna get to the part two of Josh's question here in a second, but first roll, let's take a break, and now we're moving on to part two of the question, which was also what age should I make sure I get a policy before?

Is there a certain age where if I apply for a policy, it will be significantly more expensive or is it all health based and so that Josh, don't worry about it. It's not like car insurance where once you hit twenty five, you know, like the price is gonna

drop off all of a sudden. It's not the opposite of that when it comes to life insurance, because it's like eminently provable that your knucklehead before twenty five and you're gonna like start reckoning to I mean that's I got into like three REX before the and I haven't gotten into one since. So yeah, yeah, same here man. In college, I was I think I was brain damaged. I mean they say it because like that like especially

is in a cortex, like isn't fully well? Is it male specifically that the like the brains don't fully developed. I wouldn't put it past us. Yeah, I don't know if my brain is fully developed even now. But I look back now there's things I asked myself, like what

was I thinking slash doing completely? So yeah, there really isn't a magic age like there is with car insurance to get a term life insurance policy, but typically the longer you wait to get a policy, the more it's going to cost you likely an average of eight to pump every year that you wait. You might also have to go through a more thorough health exam the older

you get. So if you are purchasing a term life insurance policy in your twenties or early thirties, it's gonna be cheaper and a little bit easier when it comes to the health exam. And if you wait longer, you know, it's probably gonna be a little more in and the rates are going to go up. What do you mean by intrusive health examgle You know they put the glove on and you know how it goes from there. Um, yeah,

I will say so. The health factors, you know, fitness and dangerous hobbies, those are things that way into the underwriter's algorithm, I guess pretty heavily, so disc off, I'm fine, but skydiving not so good, right exactly. But luckily those are things that we have control over, you know, like your general state of health. Awesome, you know you can

do something about that same thing with dangerous hobbies. There are things that you can't control quite as much, like your your health, family health history, or even like pre existing conditions. Certainly you don't have control over those things, but it's worth mentioning, worth knowing as you're sort of deciding whether to kind of hold off and put off getting a life insurance plan or if you're going to

go ahead and get one now. Yeah. And the cool thing when it comes to health insurance exams, Matt, you and I, when we both got our policies, it's it's changed a lot. And so you know when Emily and I got our policies and nurse came to our actual yas I was gonna say, because uh, nurse came to my house like on a weird because I'm hanging out my living room and she's got all of your nurse gear. Yeah,

they like draw your blood. They're like staring you down, you know, like poking you in the face stuff like that just makes sure you're healthy. And uh, I didn't get poked in my face, so that was just me okay. Uh. The cool thing is that a couple of companies have developed something called instant term now that they're able to

finalize coverage without the need for a medical exam. The cool thing is, you know, they're asking you a bunch of questions to find out your health history, and then they're looking at a combination of that and your medical records, and they're able to determine, you know, kind of what rate you should be insured at based on those things. That's kind of cool and two of the best companies to get quotes at in general, but that actually do this kind of instant term process where you don't actually

have to have a nurse come to your home. Our companies like have in Life and Policy Genius, and so we'll have links to those two companies in the show notes on our website. But if you kind of want the the easy ticket to get in term life insurance, man, those are two companies I would recommend shopping with. Okay, then, so our advice to you would be to get some level term life insurance as soon as you have an

insurable need. Once you are financial really obligated, and then you have family members who are counting on you to pay that financial oblication, you want to take care of them if you aren't there to work and earn money to pay that financial obligation. So say you have a partner and you have a mortgage, that is a time when you're gonna want to consider getting life insurance. Say

you have kids. They're all dependent on you, whether they're solely dependent on you, if your spouse is not employed, or even still if you're both employed, You're gonna need some extra coverage there when it comes time to kind

of sort out your finances after you've passed. And so, say you're a co host of a craft beer and money podcast and your wife doesn't have life insurance, you should really consider getting some life insurance for her, right because we are bringing in a bank and Uh, I know that if I were not able to podcast anymore, that Kate would be really hurting when it came to her grocery budget. It's true, man, it's true. Another thing I wanted to address really quick, Matt, is you know

life insurance through work. A lot of people are offered life insurance through their employer and they think that's the best place to get it, right. It's the easiest place, right. You just kind of click something every year during open enrollment and you get more life insurance. Well, the thing is, life insurance through work is actually much more costly when you factor it out, uh than getting a term life insurance through say a site like policy genius dot com.

So we would say, shop the open market, don't get the life insurance provided to you through work, and most people, you know your employer is gonna offer you a small amount for free, So take that, right, take the free life insurance. But anything on top of that, you're gonna want to shop on the market. And the one caveat to that is if you have real health problems that would prevent you from getting a decent rate on the open market, then it might actually make sense for you

to get an insurance through your employer. If you can't shop the open market and get the good rates, that's right, you might just have a dangerous hobby that you just can't kick. In that case, keep that nine of five. It's like, sorry, Joel, you're playing too much Settlers of Catan and we're worried about risk injuries. So yeah, mean

that's right. And that also makes me think of getting an additional plan sort of like you said, uh, sometimes that's referred to as layering um, and that's definitely something

that you can do. So say, like in our case, we got a policy several years ago, and if Kate and I sat down and decided that the coverage that we have isn't quite enough and that we don't really feel comfortable with what we have anymore, Well, I can't get another another policy and sort of you know, layer that on top to kind of sort of fill that gap, sort of fill that need and get us to where

we are comfortable. Doesn't mean you need to totally trash the existing policy that you've been paying into, and chances are you're gonna want to keep that around because you've locked in a nice low premium for however many years, and so layering is definitely something you want to consider. And yeah, so gooding back to Josh's specific question, right, like, that's that actually might be the perfect solution for him, is to to do the layering and get a small

policy that extends for longer than his current policy. So let's say he's not fully self insured in fifteen years, right, he doesn't have that two million dollar net worth like we talked about earlier, but he's most of the way there. He still feels like he has an insurable need. Well, if at the age of thirty five, which is which is how old he is right now, he decides to take out a twenty five year fioud dollar policy, well that that might kind of be that perfect layering that

he needs. It doesn't add much monthly expense to pay those premiums, but it gives him kind of that ability to not rush quite as hard to make sure that he's financially independent fifteen years. He gives him like a little more leeway. So you know, that's a good good way to do it, is to do kind of some layering like you talked about. I think it's a great solution in the case you feel like you need more after you've taken out kind of an initial policy and

you feel like it's not enough. Yeah, man, I like that. All right, man. Let's get back to this beer Odd thirteen Brewing Intergalactic Juice Hunter, and it's called Juice Hunter because it is a juicy double I p A. It's so good man, Yeah, man. I don't know what to say except for, you know, when I had this beer with Carl at the podcast conference that I went to. We had it actually right after we had a beer called Hetty Topper, which if people don't know about that,

it's one of the best beers in the country. It was like one of the original New England style I p A. S right, yep, And I like this one more, and I still do. This is the freaky conlicious, So, having not ever had a heady topper, I'll just go ahead and agree with you. I really like this as well. I'm still not sure about the the kind of the graphic novel comic book artwork. Did you ever get into like Marvel and d C? No, the comics. Do you even see like the comic book movies? No? I hate them? Dude,

do you really? Yeah? You gotta you gotta watch a couple of them. I hate superhero movies, and plus, like, how many Spider Man's can you make? Really? Well, really, I'm not saying I want to watch another Spider Man, but evidently Infinity War, which sounds kind of ridiculous. That's like they all come together, all the superheroes. Dude, I don't even know what movies are out anymore. Like, seriously,

I couldn't tell you one movie in the theaters. It's ridiculous. Well, if you want to see a superhero movie while you're drinking Intergalactic Juice Hunter, watch Infinity War because evidently it was awesome. A I'm assuming there's a Star Wars and the Harry Potter is done, so that's all I know, did shut up? Don't you talk about about Harry Potter. I love Harry Potter, but it's just done. It's not in theaters anymore, right now. I love Harry Potter. Is good.

I can get on board with that. Dude in any depressing indie movie that's up for best picture, I'm up for that. But now, man, I don't do superhero movies. Yeah. That being said, I'm totally cool with them putting that on the can, because, dude, you can put anything on the can. Can just be a blank can or just like a stick figure drawing of like a guy porn hops into a giant brewing that. Yep, I'd be fine with that. Literally, anything on the can. If the beer

taste is good, it doesn't matter, I will drink it. Yeah. One of the best I p a s I think I've had, gosh man like to date, you know, like the juice, the hops, the kick, like that hoppy kick. It's all there. I miss I p as. Has been so long since I've had some good I p a s. Thank you for bringing this down, man, No problem, buddy, all right, so real quick, let's go over just a couple points of the need to knows about term life insurance. Based on Josh's question, the first thing is only consider

a level term life insurance policy. Josh, you're already on the right track. You mentioned how you've got a fifteen year policy term life. That's what you want. Only consider that. Keep in mind that the point of life insurance is to have insurance until the point that you can be self insured. Once you're financially independent and you don't need that insurance to to be able to pay off your debts and to support your family, then you don't need

to have that insurance policy anymore. So the fact that you've got a fifty year policy because you're planning to be self insured within that period of time, I love it, man. That's great. Yeah. And people will try to pitch you on a lot of different names of life insurance, but really the best, the cheapest, the one that you want to look at is term life insurance. It's got the least amount of commission, the best bang for your buck. Yeah, and you want to make sure that it's going to

cover any insurable need that you have. So if a two million dollar policy is going to cover your family in the event of your untimely death, then that's great. And for me and Matt, you know, we have lower amounts because of how our investments are structured, we don't feel the need to ensure for quite as much. So it really depends on your individual situation. What you're insurable

need is. And once you assess that, you can decide the term length and the amount that you need to be insured for and as far as the win So when should you buy level term life insurance? Well, as soon as you have an insurable need um meaning if you have family or anyone that is dependent on you in your income that you bring to the table, you want to have some life insurance. Yeah, and you want to make sure you shop just like you shop for anything else, right, to get the best price. Well, term

life insurance. You want to shop with reputable companies, but you want to get the best price, right, And so we would recommend shopping at websites like haven life dot com and policy genius dot com. We'll have those linked for you in the show notes. And policy Genius in particular, you know, pitt some of the major companies against each other bidding to offer you the lowest cost term life policy possible. And lastly, Josh in your situation, Man, it

sounds like you're covered really well. But the one thing you might want to consider it is what Matt kind of talked about at the end is layering, right, and so maybe adding a smaller policy that covers you for a little bit longer term just in case you feel you're feeling a little bit uncomfortable about meeting that fifteen year window to be financially independent where your net worth is actually going to be more than the term policy amount. And honestly, I think any listen I can kind of

take comfort from that. Right. Being able to have the option to layer it means that you don't have to get it exactly right. Uh the very first time. You can sort of switch it up. You can change things. So all that being said, if you have an assurable need, go ahead and get life insurance. It doesn't have to be perfect. Having something is better than nothing because you want to have that in place, no doubt. Thanks everyone for listening. Our home on the web is how to

Money dot Com. Check it out. We'll have our show notes up for this episode, and hopefully you found this episode helpful. If you found it randomly, be sure to check us out on Apple podcast where you can subscribe and you can get all the new episodes as they are released until next time. Buddy, Best Friends Out, Friends Out, WHOA shot that one across the table? There