3 Things 7-12
07/12/2021 Although MAS is a financial services company, not everything published herein will be about numbers or investing. But no matter the topic, we hope for three things: 1) That you find the time you spend engaged worthwhile. 2) That you’ll reach out to us for help in any of our areas of expertise if something we discuss creates an urging in you to do so. 3) That you’ll share this with somebody new each time you read it. Thing One More On Last Week's Life Insurance Topic A reader of the newsletter reached out and asked a question after reading last week’s installment about life insurance. He was trying to determine how much he needed so he was asking me about the best way to go about determining that. I told him that, in my opinion, there was no “best” way to arrive at a number but that there were things that should be considered. I told him that he should start by asking the following question: If I died today, how much money would my loved ones need to keep living the same (or a better) financial life? From there, I told him to start doing the calculations on:
How much income they’d have to replace.
How debt much they’d need to repay – including medical liabilities.
How much of their other current and future expenses he would want to cover.
That exercise, I explained, would give him a solid number to start with. From there he could start shopping for policies that matched. At that point, he’d have to consider whether he wanted term or whole life which would have him thinking about whether his loved ones would need coverage forever or just until they were able to generate enough income on their own to sustain themselves on their own. (Note, term is generally much less expensive than whole life) Two points of caution here. First, age and health are the key cost factors in life insurance. The younger and healthier you are, the less expensive your policy will be. Second, many people make the mistake of assuming the life insurance they have through their employer is adequate. And while it may well be if they die while employed by that company, those policies aren’t portable. So let’s say a 25-year-old gets insurance through a job and doesn’t buy any other insurance. They work for the company for 15 years and then leave. The new company they work for doesn’t offer insurance so they have to shop for it now on the open market. They are now a higher risk to the insurance company (older and presumably actuarially less healthy) than they were 15 years ago. As a result, their insurance costs will be significantly higher for the same coverage than if they had purchased it when they were younger and didn’t think they needed it. Think it through and then get covered if you determine you need to be. And, as always, we can help.
Thing Two A Doctor, A Confused Football Player, And A Congresswoman On July 4, 2021, Cori Bush, a black, female member of the United States Congress, tweeted to her 832,000 followers: “When they say that the 4th of July is about American freedom, remember this: the freedom they’re referring to is for white people. This land is stolen land and Black people still aren’t free.” In a direct rebuttal to that tweet on the same day, Marlon Humphrey, a young, black man who was born and raised in Alabama and also attended the University of Alabama for two years on a football scholarship before turning professional and recently signing a $98.7 million dollar contract extension making him one of the highest-paid players in the NFL said: “I feel free lol.” Mr. Humphrey was bombarded by replies from people who were intent on shaming him for daring to assume he was free. The crux of the most prevalent argument was that there’s a difference between feeling free, which Mr. Humphrey did, and actually being free which, according to the wisdom of the crowd, was impossible for Mr. Humphrey as a black man in America. It’s a good thing for Mr. Humphrey, and the people he is able to convince that believing is seeing since, in America anyway, you really are as free as you believe you are. It’s a good thing for Ms. Bush and people like her who are trying to amass power and wealth through politics that people are so easily convinced that all they need to do is vote for the right people and all the world’s problems - racism, poverty, greed, war, hurricanes, hot summer days, and much more - can be fixed by voting into office people who will fight for them and make sure everything is fair. And it’s a good thing that Marion Hood is in the Marlon Humphrey camp. On August 5, 1959, Mr. Hood, who had wanted to be a doctor since he was 8 years old, received the following letter from Emory University in response to his medical school application: “I am sorry I must write to you that we are not authorized to consider for admission a member of the Negro Race. I regret that we cannot help you.” Dr. Hood (yes, I said Dr. Hood) eventually studied medicine, at Loyola University in Chicago and went on to have a long career as a gynecologist and obstetrician in Atlanta. He did this starting in 1959 – when Jim Crow and the KKK were in their heyday. That wouldn’t have been possible in a country that wasn’t free. Not free from evil, or hatred, or heatwaves mind you, but free despite those things. As it turns out, the football player wasn’t confused. It’s too bad more people don’t see it that way. How do you see it? Remember, either way you're right.
Thing Three Just A Thought “I'd rather be an optimist and a fool than a pessimist and right.” — Albert Einstein