As part of my financial planning work for clients, often clients need life insurance coverage to provide needed protection in the event of their death. I donate all life insurance commissions to charity.
As part of the financial planning process, I look at many facets of a client’s financial situation. This includes discussing financial goals and dreams, but it also includes the practical aspect of protection.
Protection of Term Life Insurance
Auto insurance is intended to protect you in the event that you have an accident or something happens to your car. If you get into an accident or experience damage to your car of some kind, you may look to your auto insurance to cover the expense associated with the incident. However, years may go by without you ever experiencing a claim on your insurance.
Like the protection you get from your auto insurance, whether or not you use it, term life insurance can be considered protection.
Protection for your Personal Financial Situation
Protection is an important part of a person’s financial situation. For example, are there any loved ones who rely on your income to live? This could be a child, spouse, ailing parent, etc. If you were to die suddenly, how would that loved one be able to continue with the lifestyle they have become accustomed to, without your income? On top of dealing with the emotional trauma of losing you, these family members would then need to figure out how to pay their bills, sell their home, cover the cost of day to day living. This is one reason for getting life insurance.
How Life Insurance is Sold
Most life insurance is sold through an agent who matches up the client and needed coverage, with an insurance agency who can offer that coverage based on the client’s personal health nuances. Clients pay a specific amount, called a “premium”, to have the life insurance coverage. Agents typically get paid through commissions, earning a certain amount of the premium paid by the client to have the coverage.
For me, I don’t want a financial incentive to get in the way of recommending life insurance coverage that I believe to be best for my client. So, I donate all the life insurance commissions I receive to charity.
Past Charitable Donations
- The Association of African American Financial Advisors (AAAA) which “envisions a future where the Black community is financially savvy with expert guidance to sustain generational wealth.”
- Prescott Parents in support of the educational needs and community-building at William H Prescott Elementary School, a Chicago Public School.
- Loquate.tv whose mission is to bring peace and unity through all through building community.
- The Council for Economic Education whose strives to incorporate personal finance and economic education in our nation’s schools.
The themes of these organizations center around community-building and/or education, including financial education. These two areas are of special personal interest to me. I believe we need to make quality education, including education around personal finance, more accessible to all. And I believe one way of doing this is through building connections within our own communities, so that we can leverage each other’s strengths in support of each other and creating stronger communities.
To me, donating 100% of my life insurance proceeds is one way that I can do my best to act in the best interests of my client, as I believe a fiduciary should.
Are you interested in working with someone who believes in giving back to the community? I am. Reach out if you’re that person too!