Suze Orman is a renowned financial advisor, TV personality and motivational speaker. She is the author of 10 books and has been the host of the award-winning “The Suze Orman Show” since 2002, on which she advises people on different matters concerning personal finances and investments.
What Does Suze Orman Say About Life Insurance?
Suze’s approach is “people first, then money, then things.” Basically, if there are people who depend on you and your income, you should get life insurance. Protecting your loved ones should be your top priority— before your personal wealth and possessions.
Basically, life insurance is one of the most important types of insurance coverage you can get.
Suze’s Coverage Recommendations
As far as specific forms of coverage go, Suze does recommend term life insurance, preferably a 20-year term life policy. She also advises that the policy amount be at least 20 times what you make a year.
For example, if you are 35 years old and make $37,000 a year, your policy should be worth at around $750,000. As far as actual insurance providers go, Suze doesn’t have any specific recommendations, but she is a paid spokesperson for a large insurance agency (we’ll go over that soon).
She’s also a buy term and invest the difference supporter. We are too, but it’s not a strategy for 100% of people looking for life insurance.
Our Views on Suze’s Recommendations
We hold Suze Orman in the highest esteem and believe that she does have a lot to offer in terms of financial advice. She, along with Dave Ramsey, help many people learn about their spending habits and finances. That said, there are a few things that people need to consider before going along with her life insurance recommendations.
To start, a 20-year term is not for everyone, especially someone who is only 35 years old. After all, the average 35 year old will likely work for longer than 20 more years, and most people in this age group will certainly live beyond age 55.
To put it simply: 20 years just isn’t long enough. The good news is that not only are they more practical, but 30-year term policies really don’t cost that much more than 20-year ones for people in this age group.
Life Insurance Ages
Likewise, a 20-year term may not be suitable for people who are on the older end of the age spectrum. For example, many of our clients who are 50 years old (or older) opt for a 10 or 15-year term policy. This way, they are typically still covered until retirement, and it is generally much cheaper than longer terms.
In fact, we often recommended that people purchase a combination of term and permanent coverage— thereby saving money while still ensuring that no matter how old they are, something will be left behind for their loved ones.
Suze Orman and SelectQuote.com
Finally, Ms. Orman mentions SelectQuote.com as a recommended insurance agency. While it is true that this company does work with some of the nation’s top life insurance companies, they are not for everyone. You can learn more in our review of SelectQuote, but in the meantime, here are some main points to consider:
First and foremost, Suze is paid by SelectQuote. You should know that the main reason Suze Orman even mentions SelectQuote is because they are a paid sponsor of her TV show, not necessarily because their company merits a recommendation.
SelectQuote is not actually an insurance agency, but a call center made up of “agents” trying to meet their selling quotas. The problem with these types of places is that you are often pressured to purchase a policy when you first call them, and then you will hardly get to speak to the same person twice.
SelectQuote only offers coverage from 11 life insurance companies, thereby limiting your choices and likeliness of getting the lowest premiums possible. By contrast, Life Insurance Blog works with all of the providers SelectQuote does, but also over 20 additional companies.
If you happen to be one of the many individuals with a pre-existing medical condition, you will not be offered the best prices with SelectQuote. This is largely because they are limited in their insurance providers and therefore are not able to compare a wide variety of quotes.
So, the bottom line is that Ms. Orman does offer some very good financial advice on her show and in her books. However, the Susie Orman life insurance recommendations we’ve come across should not be heeded without first considering all the details. There are many advantages and disadvantages of life insurance, and it’s not as simple as how Suze explains it.
If you’re interested in life insurance and would like personalized, attentive service, please feel free to give us a call. We’ll get you a customized quote and more information on getting the right term life insurance coverage for you.
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Originally posted 2013-09-17 18:10:50.