John Denning: Are You Ready Financially?

Marvin H. Feldman, CLU, ChFC, RFC, President and CEO of the LIFE Foundation

Fifty percent of the US population accounts for just 2.7% of all health-care expenditures, while 5% accounts for 49.5% of all health-care expenditures, according to Kaiser Family Foundation.

The life expectancy at birth of an average American was 62.9 years in 1940, five years after Social Security was created. Life expectancy today is 78.7 years (source: Center for Disease Control). As a result of this increased life expectancy, it will take $293,000 to pay for post retirement health care that’s not paid by Medicare, according to Kaiser. Are you financially prepared for this?

Are you financially prepared to raise your children? A child born in 2012 will cost a higher-income family (those making at least $105,000 of before-tax income) $399,780 in 2012 dollars (i.e., a present value amount) and $501,250 in inflation adjusted dollars through age 17, and this does not including college (source: Department of Agriculture). How will this be paid if you were to die or become disabled today?

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John Denning: A Wake Up Call on College Funding

Marvin H. Feldman, CLU, ChFC, RFC, President and CEO of the LIFE Foundation

A child born in 2013 that begins kindergarten in the fall of 2018 would attend college between the years of 2031 and 2035. If that child attends an average private four-year college, and if the annual price increases for private colleges experienced over the last 30 years (+5.7% per year) continues into the future, the aggregate four-year cost of the child’s college education (including tuition, fees, room and board) would total $483,238 or $120,810 per year.

The first question is: Are you saving enough to pay for this? The second question is how will your family pay for this if you die prematurely and have not accumulated these funds?

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