Pretoria - Most people who get sold life insurance do so from a place of ignorance, according to CEO of The Wealth Chef Ann Wilson, who is a self-made South African millionaire.
Wilson believes anyone can become financially free as a result of their own efforts and abilities, but most people have just never been taught how.
Through The Wealth Chef, Wilson provides anyone who has the desire to achieve financial freedom, all the recipes and menus they need to create abundant wealth.
"Life insurance serves a very specific purpose on your financial freedom journey but sadly 99% of people who get sold life insurance do so from a place of ignorance and so get misdirected and mis-sold stuff they don’t need."
In this video, Wilson provides knowledge to empower people about life insurance so that they can know:
• What the purpose of life insurance is;
• How to determine whether you need it or not;
• What type of life insurance you should buy and what life insurance to avoid; and
• How long you need it for.
Watch the video to find out how much life insurance is enough:
There are two types of life insurance, said Wilson. One is called whole life and the other is term life.
"The only kind of life insurance you ever want to be touching is term life. Think of the word "term" which means that you want it for a period of time."
Wilson pointed out that life insurance is not meant to be some kind of life lottery for those you love.
"The point of life insurance is to fill the gap (financially, a fixed lump sum) between the value of the assets that you currently have in your life and the assets you need for your Financial Freedom Number (FF#) that can earn you the income to meet your lifestyle costs in the event that you aren't there to earn that income."
This is why term life insurance is only for a period of time, while you are building your assets, said Wilson.
On the other hand, whole life insurance by its very nature says it covers you for your whole life and by its very nature, it is going to pay out because life is fatal.
"So it has a much higher premium because it is going to pay out and this is where so many people waste so much money buying this whole life insurance when in fact all they want is an insurance to cover this gap, which is going to cost you a lot less money and serve its purpose," said Wilson.
"Having worked with thousands of people around the world, I know that finally understanding life insurance can be a massive light bulb moment and for many Wealth Chef’s in the making this information also saves them thousands each and every month which can then be directed to filling up their asset pot instead of filling up the insurance companies coffers."
In the video, Wilson also mentions that you need to know your Financial Freedom Number (FF#) to determine how much life insurance you need (if any).
If you don’t yet have this seriously important number at your finger tips then click on this link to calculate your FF#.