As longevity and the cost of living continue to increase, Americans may be overlooking a key opportunity to strengthen their financial foundation. Despite the many advantages of permanent life insurance, only 22% of Americans currently own a permanent life insurance policy, a fraction of the 66% who have savings accounts, according to Northwestern Mutual's 2014 Planning and Progress Study.
In contrast to savings and investing vehicles that focus on either asset accumulation or risk management, permanent life insurance is a multi-faceted financial solution that augments a death benefit with a number of important living benefits.
"Permanent life insurance is the proverbial Swiss army knife of financial solutions because it can be used to tackle any financial challenge from leaving a legacy to dealing with a medical emergency," said David Simbro, senior vice president, Northwestern Mutual. "Flexibility, combined with the fact that permanent life insurance is virtually recession-proof, means invaluable peace of mind in today's complicated and unpredictable economic environment."
According to Simbro, the advantages of permanent life insurance include:
- Guaranteed growth in value over time: The cash value of a permanent life insurance policy never declines and is guaranteed to continue increasing over time, tax-deferred.
- Flexibility: Policy owners can leverage the value to pay for college, fund a business, or address any number of planned or unexpected financial needs. Because of its assignability, the policy can also serve as collateral.
- Retirement: Policy cash value can be leveraged to supplement retirement income.
Participating in LIAM
As the company that is committed to helping Americans achieve financial security, Northwestern Mutual is leveraging this month’s Life Insurance Awareness Month (LIAM) campaign to deepen awareness of permanent life insurance and how it can serve as the cornerstone of a sound financial strategy.
Simbro is encouraging consumers to meet with a financial advisor to explore the role permanent life insurance can play in their overall planning strategy. And Northwestern Mutual's Online Learning Center features a wide range of resources and tools for individuals interested in learning more about the many attributes of permanent life insurance. For more information, visit www.northwesternmutual.com.
LIAM is a public-relations campaign coordinated each September by the Life Happens organization to increase Americans’ awareness of insurance and the critical role it can play in their lives. To learn more about LIAM and the tools provided by Life Happens, visit www.lifehappens.org.
By Ayo Mseka