Now, I’d like advice on my megacorp benefits choices for Life Insurance.
We’re currently paying $900 a year for coverage of 7 times my salary with term life insurance through my employee benefits. I’m proposing we can dial that down, and invest that money. It isn’t a ton of additional savings, but we’ve been looking for as many “right sizing” opportunities over the past few years, to crank up our savings rate – and to help improve our needed expenses level.
- 2 times salary for $0 annual contribution – dropping down to 2 times my salary coverage for $0 (for me) a year, saving $900 a year. My employee benefits would cover this cost.
- 3 times salary for $200 annual contribution - dropping down to 3 times my salary coverage for $200 a year, saving $700 a year
- 7 times salary for $900 annual contribution – staying at current level of 7 times my salary coverage for $900 a year, saving $0 a year
In my mid to late forties, with good health, let’s imagine that I am 0-4 years away from easily being able to retire. I’m planning to retire in 4 years, at the earliest. We both work, but my salary is a large percentage of our working income.
In case the unexpected happens while I’m still working, my spouse (w/ 2 kids) would be provided the insurance payout (equivalent to about 4 years of my income since it would be tax free), our current savings, and the ability to generate additional cash by downsizing (large equity in primary residence).
Would appreciate any advice you can share here.