Agents in the field have repeatedly told National Underwriter that very few members of the baby boomer market have done any retirement planning at all (see NU, Oct. 27).
Part of the reason is that many boomers, especially the younger segment, “want everything nownot just the house but the big house and the expensive cars,” says James Jacobs, a financial advisor with Jacobs Financial Group, Chesterfield, Va.
Jacobs notes that its not that boomers dont want to do any financial planning, they just dont have any money left over after all their expenses. Many of these boomers face the same shortfall of cash when it comes to their life insurance planning.
“The problem is if you ask the average person to spend $400 a month on a car payment they say no problem, but if you ask them to spend that same amount on a life contract, theyll look at you like youre nuts,” adds David Bryant, an agent with Farmers Financial Solutions, Tulsa, Okla.
“The good news is that people are more realistic about their insurance needstheyre buying much more coverage,” says Bryant.
Even though these boomers are strapped for cash at the end of the day, they are buying the coverage they need to provide for their family. That coverage is coming in the form of low cost level term insurance and/or universal life coverage.
In a typical scenario, Bryant explains, a 45-year-old male who needs $500,000 of coverage can buy a 20-year guaranteed term product for about $90 a month. For that same amount of protection in a permanent type of product it may cost him $600 a month, he says.