Dave Ramsey's Examples May Not be Right
By Keith Bunn Jr.
November 18, 2013
Is Dave Wrong?
A few weeks ago, at the beginning of an Financial Peace University (FPU) class that my wife and I coordinate at our church, one of the class members told me that after the class on insurance, they looked all over and called a bunch on insurance brokers but none of them quoted them the dollar amount even close to what Dave Ramsey's example was in the video they had watched the week before.
The part of the class they were talking about was about life insurance and in Dave's example, he was talking about a made up 30 year old guy named Joe, who got Term Life insurance anywhere between $13 to $21 per month. The class member's issue was that out of all the insurance brokers they contacted, none of them gave them a quote anywhere near the $13 to $21 Dave had talked about and wondered if Dave was wrong.
Life Insurance is Based on a Few Things
The truth is, the example Dave talks about in class is an average of a healthy 30 year old male. The cost of life insurance is based on a few things...
1) Are you healthy? If you have a medical condition of any kind or are taking medications prescribed by a doctor, chances are, your premiums will be higher.
2) How old are you? If you're middle aged or older, the cost of any kind of insurance will go up the older we get, especially life insurance.
3) Do you smoke or use any kind of tobacco products? We've all heard the studies over the decades that 1 in 3 smokers die of cancer. I don't know the statistics about chewing tobacco, E-cigarettes, etc... but I'm sure you're chances of getting or dying of cancer are greater than if you didn't use those products all. And we are talking about life insurance.
4) How much do you weigh? Again, the more we weigh affects our overall health.
I'm sure there are more things I missed, but I'm sure you get the picture on what effects the cost of life insurance. But if this has got you down and you think there is no way you can afford life insurance, there is hope.
There Are Things You can do to Lower the Cost
The truth is, we're not able to go back in time to change our past. All we have is today to start from. We can't change our age, but there are things we can all do to lower our life insurance cost...
1) Lose weight. Just by losing 5 to 10 pounds could reduce our dependency on prescriptions and improve our overall health.
2) Stop using tobacco products. This is a big one! This will greatly lower the cost of both life and medical insurance.
The thing is, Dave Ramsey's examples may not be right... For You! You have to go out into the market and try to get the best deal you can find that best suits you and your family's situation, but you DO NEED LIFE INSURANCE! And the only one I suggest is Term Life insurance.
The reason I do this, is to give people hope and to try to inspire others. To make people think about their finances, whether they are young or old, so they can win financially.
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