Summer 2020

Close the gap

close the gap

There’s a gender gap in life insurance, and the old rules for how much coverage you need may no longer apply.

Life insurance – it’s not exactly a riveting topic for conversation. In fact, it probably sat on the back burner of your life for years. No reason to pay attention if you don’t need it, right?

Then life changed. You settled down and started a family, and that seemingly dull conversation about life insurance suddenly took center stage. If something happens to you, it’s important to make sure your family is taken care of.

So you purchased a policy – maybe one for you and your spouse – and then went on about your business.

But, wait. How confident are you that you and your spouse are adequately insured? Could you be a victim of the male- female life insurance gap? In 2019, Haven Life, a term life sales arm of Massachusetts Mutual Life Insurance Company, conducted an online survey and discovered that men typically have more life insurance than women – a lot more, even when adjusting for salary differences. The result is a gap in coverage that could shortchange the very thing you’re trying to protect.


The Haven study revealed that both male and female respon- dents believed their death would have a substantial impact on the family’s quality of life. But women were less likely to have life insurance (67% compared to 79% for men). And even when they had coverage, it was only about half as much as their male counterpart.

Specifically, male participants had an average annual income of $72,482 and an average of $423,102 in life insurance com- pared to female participants with an annual average income of $52,484 and $231,342 in life insurance. Men with life insurance placed a financial value on their lives that was nearly two times more than women. While men typically have a higher salary, they also insure it to a greater degree. The male participants had about $5.80 in life insurance per dollar of annual income, compared to $4.40 for the females.

Haven also discovered a gap in the amount of life insurance coverage that uninsured men and women thought they should have, with uninsured fathers saying they eventually planned to purchase $355,348 in coverage versus mothers who said they would buy an average of $175,423.


Maybe you’re not surprised, given the well-documented income gender gap in society. After all, the formula for how much life insurance to buy has traditionally been based on income, usually 5 to 10 times your salary. Women still earn less than men on average, and they are more likely to be caregivers for children or elderly parents. So based on income alone, women would need less coverage than men.

Except it’s not all about income. Consider a couple where one parent stays home with the kids. That parent may not receive a paycheck, but his or her role has considerable value. If that parent passed away suddenly, who would drive the kids to school? Clean the house? Cook the meals? Mow the lawn?

Those are big shoes to fill. It’s important not to undervalue a stay-at-home parent’s contribution to the family – even if that person isn’t a W-2 breadwinner – and insure accordingly. estimated the value of the work of a stay-at-home parent and arrived at an annual salary of $178,201.


Is it time to re-evaluate your life insurance? Start by:

  • Re-thinking how you value the roles in your family
  • Viewing life insurance as a shared vision
  • Putting life insurance to work in other areas of your life

These policies have exclusions and/or limitations. The cost and availability of life insurance depend on factors such as age, health and the type and amount of insurance purchased. As with most financial decisions, there are expenses associated with the purchase of life insurance. Policies commonly have mor- tality and expense charges. In addition if a policy is surrendered prematurely, there may be surrender charges and income tax implications. Guarantees are based on the claims paying ability of the insurance company.

Sources:;;;; fa-mag. com;

Cash fact or fallacy?

With these seven moves and a little practice, you can project confidence at your next public speaking gig

Combat common cash myths with cold, hard facts

We hear it all the time. Cash is king. And like a monarch, cash isn’t worth much if it just sits there. As a rule, even Warren Buf- fett keeps enough cash on hand to seize potential investment opportunities and to serve as ballast in rougher market environ- ments. As interest rates have risen over the past few years, cash and cash alternatives have emerged as viable sources of rela- tive liquidity while offering a hedge against downturns.

So how much cash should you put to work? Here are a few myth-busting facts to help you find that cash sweet spot.


FACT: Cash’s performance may seem lackluster during rising markets, but its low risk/reward profile is intended to provide stable value during market declines. During periods of rising interest rates or stock market turbulence, cash tends to do well relative to other asset classes. It’s not hard to find ways to earn interest on your cash, even when the Federal Reserve changes its benchmark rate. Holding cash or cash alternatives is part of a well-allocated portfolio in which diversification of asset classes may offer different benefits in a variety of market environments.


FACT: Think of cash in two ways: everyday spending and stra- tegic cash for future needs. While the $20 bills in your wallet offer a convenient way to pay for everyday items, cash in your port- folio buys you time to think. Access to enough liquidity gives you flexibility during times of opportunity or uncertainty. You need confidence and capital to add fundamentally sound positions to your portfolio when the stock market is “on sale.”


FACT: A right-sized cash cushion can actually be a sign of opti- mism. If market turbulence makes you skittish, increasing your allocation in cash might restore your confidence in your long- term financial plan. Plus, cash tends to do well as a “defensive asset” with low or negative correlation with equities.

Some investors may try to chase yield during unexpected market movements or low-interest-rate environments. But when it comes to cash, access is very important. How much you hold depends on your risk tolerance and your investment objectives, but everyone can benefit from a cash cushion to stave off impul- sive selling in shaky markets or pay for unplanned expenses.


There’s a reason investing pros do not recommend stuffing the proverbial mattress with cash. Holding too much cash for too long could mean missing out on stronger performance from other asset classes or losing buying power to inflation. Ask your advisor for help optimizing your payable, on-demand cash so you gain low-risk, high-liquidity flexibility to help you make progress toward your long-term goals.


When trying to determine how much cash to keep on hand:

  • Adopt a moderate approach
  • Consider your risk tolerance
  • Talk to your financial advisor about your investment goals

Investing involves risk and you may incur a profit or loss regardless of strategy selected. U.S. Treasury securities are guaranteed by the U.S. government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. Certificates of deposit offer FDIC insurance and a fixed rate of return. The mar- ket value of fixed income securities may be affected by several risks including interest rate risk, default or credit risk, and liquidity risk.

Sources: Investopedia;;;

Tips from the top


Wise words from six wildly successful women

It’s easy to feel like highly successful professionals have more hours in a day than the average person. How else do they manage to accomplish so much? The truth is, maintaining a high level of productivity often stems from making deliberate choices. Here’s the inside scoop from six well-known women about how they stay focused and achieve success in a distracted and demanding world.


Facebook COO Sheryl Sandberg is well-known in the business world for bringing an old-fashioned spiral notebook to meetings, an unlikely choice for someone in the tech field. For Sandberg, analog note-taking is a way to keep things simple and maintain focus. She physically crosses items off the list and then rips out the pages when action items are complete.


Every day Jennifer Hyman, co-founder of Rent the Runway, allots time to one or two problems that are important to address strategically. She creates the necessary time by periodically cutting off access to email, texts and social media notifications that threaten to divert her attention. According to Hyman, it makes no sense to spend your day managing to inbox zero.


When your day gets crazy and your thoughts are cluttered, consider taking a break to clear your head. Oprah Winfrey spends 20 minutes each day sitting in absolute stillness. Not only is it the perfect formula for clearing her mind, but it also helps her focus on current jobs and outstanding projects.


When Katie Couric needs to focus on something, she has someone take her phone away. It doesn’t matter who it is – her husband, her daughters or her assistant – it can be whoever’s with her at the time. What does matter is that she doesn’t get the phone back until she’s completed the task at hand.


Former Secretary of State Condoleezza Rice encourages people to stick with their goals even when things get tough or it takes longer than expected. It’s a lesson she learned at age 10 when her mother refused to let her quit piano lessons. You’re tougher than you think, she says, so don’t let setbacks deter you from bigger accomplishments. Rice went on to play piano with artists like Aretha Franklin and Yo-Yo Ma.


When it comes to work-life balance, it’s a false tradeoff to say quality time versus quantity, according to Hillary Clinton, another former Secretary of State. You have to have both. If you work long hours like she did – and you want to carve out time for family – the only solution is to get rid of things in your life that you don’t need. Save them for later when your time is your own.


When you’re ready to tackle your next big goal:

  • Tweak the advice of successful people to make it your own
  • Take time to shift your attitude if needed
  • Develop creative strategies tailored to you
  • Re-evaluate your options


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