The FAMILY Method™ - Part 4 | I - Insure What Matters
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[00:00:00] Hey friends. Welcome back to the Household CEO podcast. It's Calista Anderson here. Today we're continuing the family method, the framework. I teach modern families to build stability, protection, and long-term legacy. If you are new here, family stands for fund and manage cash flow, attack debt, multiply income.
Ensure what matters, leverage assets, and your legacy. Today we're on the letter. I ensure what matters, and this is one of the most important conversations we can have. Let's start by saying something out loud, and I wanna say it as gently and honestly as possible. We all die. That's not [00:01:00] pessimistic. That's just the reality.
And yet we plan birthday parties, vacations, college dreams, and retirement, while avoiding the one plan that protects all of it. Life insurance is uncomfortable to think about, and generally speaking, it has gotten a bad rap, but avoiding the conversation doesn't avoid the outcome. When a family loses a loved one without a financial plan in place, grief doesn't happen in isolation.
It happens alongside panic. Final expenses alone. You know, the funeral burial services often cost between seven and $25,000. Many families end up putting that on credit cards, ~taking, ~taking up personal loans, [00:02:00] or turning to GoFundMe in the middle of their worst days. And then there's income. When a primary or even secondary income of the household disappears, ~the household can de, ~the household can destabilize real fast.
~A ~studies show that more than half of families experience serious financial hardship within six months of losing an income earner. .
~Many household, ~many widows see household income drop by 30 to 50% almost immediately. Grief is heavy enough. Money, stress should never be a part of the mourning process. ~Although this, ~although this can be a heavy topic to talk about, ~I would be doing. ~I would be doing you all a disservice by not talking about it, and trust me, talking about it is just a fraction of the ~heaviness one will actually go through at the time, and trust me talking about it is just a fraction of ~heaviness one will actually [00:03:00] go through compared to the time of a family member's death and having to talk about financial implications then.
~So let's get into it.~
~So as uncomfortable and heavy as this can be for some people, let's get into it.~
~So, as uncomfortable and heavy as this topic can be for some people, I still wanna get into it.~
~So. So as heavy and so as heavy and ~so as uncomfortable and heavy as this topic might be for some people, we're gonna get into it anyway 'cause we can do hard things.
All right. Before I get into the Family Method framework letter, I ensure what matters. I wanna pause here and share some personal experiences because this conversation isn't theoretical for me.
~I wanna share a couple things there.~
So the first thing I wanna share is that there was a season in my life when I truly lost sleep at night. I had two young children.
I was working part-time and homeschooling. [00:04:00] My husband was, and still is, the primary breadwinner. We had a beautiful life. We had a nice home, a rhythm that worked for our family, and yet , we didn't have a real plan in place.
I would lie awake thinking, what if something happened to him?
Not in a dramatic way, but in a very real practical way. If my husband passed away, I knew exactly what would happen ~given that we didn't have a financial. , ~Given that he did not have any life insurance,
we would have to downsize our home,
cut extracurricular activities, change our lifestyle overnight.
I would need to work much more away from my kids, far more than we were ever used to or wanted to be away from each other. ~I,~
that weight sat on my chest, but this concern didn't come from nowhere.
I had [00:05:00] already experienced loss, which is the second thing I wanna share with you guys. My brother died at 34 years old, unexpectedly.
We didn't plan for that. I mean, nobody does.
His passing really crushed me. I mean, there were just the two of us who grew up under the same roof, ~four s. ~For a good part of my life.
And so dealing with his passing was already so super heavy, so super devastating. ~And as we were going through his ~and as we were going through his burial plans. ~W we then start, ~we then had to start thinking about the financial part of death. His final expenses totaled over $30,000, and that is because my mom wanted everything for him.
And here's the part that still moves me deeply to this day
as we were [00:06:00] going through that.
My mom had the wisdom to put life insurance in place for us when we were teenagers, and because of that, those expenses were more than covered. ~There was no financial, ~there was no financial scrambling, no debt added to grief.
There was even money left over to help with finances afterward, during a time when emotional capacity was already stretched thin.
That experience stayed with me.
~I, ~I already had my two young kids when this happened, ~and that got me thinking that, ~and that got me thinking about our own financial protection. I knew I had insurance ~from when my mom, I. From when my mom,~
from when my mom had put a plan in place for my brother and I when we were teenagers, like I mentioned,
but I realized my husband did not have one.
So I started losing sleep. I would try to talk to my husband about getting him [00:07:00] covered, and it was just a topic he avoided. ~I,~
because again, this topic is heavy and very uncomfortable.
~Eventually,~
eventually, after many, many conversations.
My husband and I agreed and we were able to put a proper life insurance plan in place for him,
And I even added additional plans for myself.
I started sleeping well again, not because I thought something bad would happen.
But because I knew that if something did, our family will be okay.
That's what insurance really gives you. Peace.
And before we go any further, ~I want you to know why I'm so, ~I want you to know why I am so confident in having this conversation.
I'm a licensed financial professional, and one of the core ways my team and I serve families is by making sure they are properly protected. [00:08:00] Every single week we sit with parents, couples, and business owners who think they're covered only to realize there are gaps they didn't even know to look for.
~Our job isn't to self fear, it's to bring, ~our job is to shine light and bring clarity. ~To ask questions. Mo ~to ask questions Most people don't know to ask and to make sure families aren't left vulnerable during the hardest moments of their lives. ~Protection planning is not a side conversation.~
Protection planning is not a side conversation in financial planning. It's foundational
and it's one of the responsibilities I take most seriously.
We insure our phones. We insure our cars, we insure our homes, but sometimes we skip ensuring the people who make everything possible. ~Life insurance isn't for you. ~Life insurance isn't for you. It's for the people who still have to wake up tomorrow once you're gone.
Okay, [00:09:00] not having life insurance is still a decision. It's just one your family has to pay for,
and I know all my ~optimists and I know all the ~optimists out there are probably thinking, you know, everything will be all right.
And it's true, everything will eventually be all right,
~but to hope that your family,~
but hoping your family will not be affected significantly is not a financial strategy.
~So there is my spiel in my experience and. I just wanted to share both. ~So there is my spiel and that is coming from ~a, ~my personal experience as well as my professional background.
Another reason people don't like talking about insurance or life insurance specifically ~is that it ~is that for many people. It's very confusing. So I wanna break it down in a nutshell and make it as simplified as I can.
~So I want you to imagine at the very top,~
so I want you to imagine at the very top of a triangle. Just imagine life insurance at the top point. Now, from [00:10:00] there, it branches off into two types. One is term life insurance, which is a temporary coverage ~that can go, ~that can last 10, 20, or 30 years. Your choice, ~and usually it's often replaced. ~And usually the purpose for this is to replace income or cover mortgage and protect children during their dependent years.
Now, at the end of that term, that insurance will no longer exist, but the point of that is to cover your family during the most vulnerable years while you have young children.
~Term life insurance tends to be less expensive than the other.~
Term life insurance is usually less expensive.
Then permanent life insurance, which is the other side of the triangle.
for term life insurance, remember, you can choose 10, 20, or 30 years, you also choose your coverage. It could be [00:11:00] 200,000. 500,000, a million dollars, $2 million, whatever would make sense for your family.
Of course, the higher the life insurance coverage is, the more expensive the premium is.
That applies to all types of insurance. ~ Which includes~
~whole life insurance index life,~
~But alongside that is up, but alongside your fixed premium.~
~Well, let me go back to the term life insurance and use an example. Um. Hmm.~
~, And again, there is, and I'm going to give you the th and ~the permanent life insurance side of the triangle has a variety of different kinds, but I'll talk about three types you might hear most about and explain those.
So there's whole life insurance, which like term insurance has that coverage. ~Let's say it's 200. Which it, it could be, ~which could be what you choose and what you get approved for, whether it's 200,000, 500,000, a million dollars, et cetera. Now your premiums are paying for the cost of insurance, but also part of your premium goes into a guaranteed [00:12:00] cash value.
So the part that goes to cash value is going to increase with some interest.
~So with this.~
And again, this is permanent coverage, meaning after 30 years, which is the max for term life. Unlike term life, this will not expire ~until,~
until the insured passes away, as long as the premiums are paid for.
And then there's indexed Universal Life or IUL. As you may hear
now, this like whole life insurance is permanent, but instead of a fixed premium, ~a set amount,~
~you. The premiums are, ~the premiums have a little more flexibility.
So if you needed to pay a little less, if you were going through a financial hardship, you would be able to do that with an IUL.
And the carrier will let you know or provide the amount that you would need at a minimum [00:13:00] to keep your policy active
and just like whole life. Part of your premium will go into a cash value side. It's like a little bank account within your policy ~with~
the difference is in an IUL, your cash value ~is tied. It is tied to mar, is tied to the market, is tied to mark. ~Is tied to market indexes or indices,
and it has protection from market losses. Meaning if the market were to drop and dive down, you would not lose any money.
And when the market goes up, ~you. ~You also gain with a market, but there is a cap.
And because both whole life and Index Universal Life has this cash value side within the plan, and as that amount increases
the owners of these plans are allowed to borrow money from that side of their plan.
~I don't know if you, any of you've have,~
~I don't know if any of you have. ~[00:14:00] I don't know if any of you have heard of this.
But this is why you might see it on your Instagram or TikTok, that you could be your own bank. Within reason
and there are so many bells and whistles ~I cannot go into on the, ~I cannot go into on the podcast, but ~just know there, ~just know that these plans are very versatile ~and can be, ~and can be structured a hundred different ways.
And I really encourage you guys to learn more about it. And then lastly, the last type of insurance I wanna quickly talk about ~is final expenses, ~is final expense insurance. ~Now these are smaller policy. ~Now these are smaller policies and they're designed specifically to cover funeral and burial costs.
These are really helpful
in the immediate time after somebody passes away.
~Because these plans cut,~
because these plans cut the coverage amount to the [00:15:00] family within 48 hours after a family member passes away.
So you don't have to worry about giving your family the proper burial or service that you would wanna give them.
~So these are just a handful of, ~so these are just a handful of different tools.
I myself have a combination nation of whole life index, universal life and final expense.
~I have, ~I have IU Ls for all my kids,
so I truly am practicing what I'm preaching.
Starting your children off with these plans at a young age ~is the, ~is going to give you the lowest cost of insurance
and then their cash value has more time to compound.
~Giving them this gift once they reach their adulthood, ~giving them such a gift in their adulthood
because again, they can borrow from this. And also once they have their own families, their families will be covered a good amount.
Again, [00:16:00] different tools, but they all have the same goal, no financial burden left behind.
Now, if you ever thought. Yeah, I've heard of insurance. I know it's something I need to learn more about, but I'll get to it later. Well, later isn't guaranteed. ~Or you might be thinking, ~or you might be thinking it's too expensive, ~but guess what? Being prepared is also, ~but guess what? Being unprepared.
Is also very expensive.
Or you might be thinking, well, I'm healthy. ~And that's exactly, ~and to that, I say that's exactly when insurance is easiest and most affordable because. I don't know if you know this, but unhealthy people with multiple diagnoses ,
will have a really high cost life insurance plan, or will not even get approved.
So [00:17:00] younger and healthier will be less expensive and almost a guarantee they'll be approved.
You might be thinking, I don't like thinking about death.
Well, I think loving your family matters more than your discomfort.
And I'm sorry if that sounds harsh, but It's so true. I think
just like my husband had to get over that discomfort of talking about death and life insurance on the other side of that is actually more peace.
And just to throw one little bell or whistle on these plans that I didn't cover as I broke it down is a lot of these plans have. Riders that cover cancer or terminal illness and other things that you wouldn't think a life insurance plan has. So it not only covers death, ~but these big life, ~but these big, ugly [00:18:00] life things that can happen to anybody
such as cancer or a life debilitating diagnosis.
So the nurse in me really appreciates that part of these plans, and this is exactly why I do the work I do. I've seen what happens when families are prepared and I see what happens when they're not.
As household CEOs, we manage risk every day. Whether we call it that or not. We plan schedules. ~We manage the cash flow,~
we manage cash flow. We protect our families. ~So make sure, ~so we need to make sure we're protecting our families financially as well.
~Just a quick note,~
~just a quick note before we wrap up the information shared.~
Just a quick note before we wrap up. The information shared in this episode is for educational purposes only, and it is not intended as individualized financial, legal, or tax advice. Insurance needs vary by individual and [00:19:00] family ~and any recommendations should be made based, should, ~and any recommendations should be made based on your specific situation after a personal review.
Coverage costs and benefits are subject to underwriting and carrier guidelines ~and carrier guidelines. Always consult with a licensed, ~always consult with a licensed professional regarding your own financial decisions.
If you want help understanding what protection actually makes sense for your family, my team and I are here to help. You can email me directly at callista@callistaanderson.com and we'll walk you through your options together ~clearly. ~Clearly responsibly and with your family's best interest in mind.
If you're listening and you're unsure what you have, you might have something but don't really know or unsure about how it works. Or unsure if it's enough to cover your family,
or maybe no one has ever explained it clearly. We would [00:20:00] be happy to help you better understand what it is you already have.
Financial needs change all the time and having clarity .
On what your family truly needs in a time of great loss will give you peace of mind.
Again, you can ~email me directly, so ~email me directly, calista@calistaanderson.com. And we can chat about it.
So that is I of the Family Method ~so that is, ~ensure what matters ~of the Family Method, framework ~ ~If this episode. ~If this episode resonated with you, or if it made you think about your family in a new way, I'd love for you to stay connected.
Make sure you're following the household CEO podcast so you don't miss the next episode. In the Family Method where we continue building real world protection, wealth and legacy, and if you have a quick moment, leaving a rating or review is one of the simplest ways you can support the show. ~It helps more families find these conver.~
It helps more families find these conversations, and that truly means [00:21:00] the world to me. As always. Thank you for spending this time with me. ~I don't take it lightly that you invite me into your ears and your life, and I don't take it lightly that you invite me to. He. ~I don't take it lightly that you invite me into your ears and your life.
Until next time, lead your home with intention. Protect what matters most. And remember, ~you are the house. ~You are the CEO of your household.
