Pick Your Community: | Hopkins | Muhlenberg | Daviess | Christian | Fayette | Henderson | Lakes | McCracken | Warren | Webster
Davis Motor Sales banner ad

Dave Says – February 10, 2013

davesays300 green2KENTUCKY (2/10/13) – This week Dave discusses basing term life insurance and fighting the insurance company

Dear Dave,
I’m looking at buying term life insurance. Currently, I’m in medical school doing my last year of residency and making $35,000 a year. Should I base the amount of insurance coverage on what I’m making now or what I’ll make when I’ve finished medical school? - Amanda

Dear Amanda,
In most cases, I advise basing the amount of life insurance coverage on the income you’re earning at the moment. After all, that’s the amount your family is used to living on, right? However, if you’re finishing up your medical degree this year, it’s a virtual certainty you’ll earn lots more in 2014. You could easily go from making $35,000 to $135,000.

I recommend that people buy term life insurance coverage of about 10 to 12 times their annual income. Considering your situation, I’d say you could afford to buy a little potential. Instead of basing it on your current $35,000 income and buying a policy in the $350,000 to $400,000 range, you might double that amount. It will still be really cheap coverage as long as you’re in decent health. And once you’re making doctor money you can adjust the amount of coverage according to what you actually make.

Good luck, Amanda! — Dave
 
Dear Dave,
My wife and I were recently involved in an auto accident, and the insurance company doesn’t want to cover the damage due to a technicality. We both work, so I’d like to find a replacement car while we fight this out with the insurer. However, we only have $7,000 in savings and we don’t want to spend it all. What should we do? - John

Dear John,
You can definitely find your wife a good used car for what you’ve got in the bank. However, leaving yourselves with no savings whatsoever is not a good plan.

I realize no one enjoys driving a beater, but that’s what I’d do right now. Just look at it as a rental car. If you spend $1,500 on a little used something, you will have $5,500 left in your savings account. Just act as your own insurance company for a while. Then, when the big guys pay up, you could just plug it back into your savings account.

Even if they don’t pay, you’ll still have a nice chunk of change sitting there. And it wouldn’t take long to save up enough to upgrade that little hooptie to something nicer and more reliable while still keeping the majority of your savings intact! - Dave
 
* Dave Ramsey is America’s trusted voice on money and business. He’s authored four New York Times best-selling books: Financial Peace, More Than Enough, The Total Money Makeover and EntreLeadership. The Dave Ramsey Show is heard by more than 6 million listeners each week on more than 500 radio stations. Follow Dave on Twitter at @DaveRamsey and on the web at daveramsey.com.

© Copyright 2014 SurfKY News Group, Inc. All rights reserved. This material may not be published, broadcast, or rewritten without permission. SurfKY News encourages you to share this story by using one of the social media links below.

In Other News...

Madisonville Police Arrest Reports - July 31, 2014

MADISONVILLE, Ky. (7/31/14) — The Madisonville Police Department released the following reports Thursday, July 31. Chad… Read More

Smoke-Free Coalition Gathers Steam in Madisonville Along 10-Stop Tour

MADISONVILLE, Ky. (8/1/14) — The Smoke-Free Kentucky Coalition made Baptist Health in Madisonville one of its stops… Read More

Most Read This Week (Site-Wide)

July 30, 2014 4365

Three Arrested in Muhlenberg as Part of…

in Top Stories by GPD Officer Wes Miller
July 28, 2014 3637

Madisonville Woman Arrested for Being a…

in Top Stories by Madisonville Police Department
July 30, 2014 3624

UPDATE: Waide Responds to Allegations of…

in Top Stories by Rita Dukes Smith, SurfKY News Director
July 28, 2014 3149

Madisonville Man Arrested for Endangering…

in Top Stories by Madisonville Police Department
July 30, 2014 2704

UPDATE: Muhlenberg Man, Woman Arrested in…

in Top Stories by Sheriff Curtis McGehee

Most Read Stories from Hopkins County

July 28, 2014 3637

Madisonville Woman Arrested for Being a…

in Top Stories by Madisonville Police Department
July 28, 2014 3149

Madisonville Man Arrested for Endangering…

in Top Stories by Madisonville Police Department
July 28, 2014 2672

Disagreement Over Killing Snake in House…

in Top Stories by Madisonville Police Department
July 30, 2014 2108

Murder Charges Filed in Death of Hanson…

in Top Stories by Det. Jonathon Barnes
July 31, 2014 1952

Nortonville Man Accused of Stashing Drugs…

in Top Stories by Madisonville Police Department

Most Read Stories from Owensboro

July 28, 2014 1493

Zuberer Takes Over at Quarterback for…

in News by Steve LeMaster
July 28, 2014 1350

Dont Miss Out on a Howl of a Good Time

in News by Brittni Bunn
July 28, 2014 1213

Instant Admissions Day is Aug. 1, 2014

in News by Bernie Hale
July 29, 2014 1040

Happenings and Meetings - Daviess County

in News by Owensboro-Daviess County Convention & Visitors Bureau
July 28, 2014 501

Prosecutors Mull Over Whether to Charge…

in Top Stories by Dennis Beard, SurfKY News

Most Read Stories from Muhlenberg County

July 30, 2014 4365

Three Arrested in Muhlenberg as Part of…

in Top Stories by GPD Officer Wes Miller
July 30, 2014 2704

UPDATE: Muhlenberg Man, Woman Arrested in…

in Top Stories by Sheriff Curtis McGehee
July 28, 2014 1729

Foot Pursuit Ends with Arrest

in Top Stories by Christopher Rogers
July 29, 2014 1684

Muhlenberg District Court Fines Handed…

in Top Stories by Charles W. Riley II, SurfKY News
July 28, 2014 1651

Boys of Broad to Launch Video at Cinema 4

in Top Stories by Paul McRee, SurfKY News

SurfKY News Group, Inc. Central Office & Printing Division
1125 Nebo Rd.  •  Madisonville, KY 42431  •  270.452.2249 (fax)
Main Number: 270.452.2727 (phone)  •  Printing Division Direct Line: 270.821.8600 (phone)

SurfKY Owensboro News Bureau
920 Frederica St. / Suite 210  •  Owensboro, KY 42301  •  270.683-8060 (phone)


Contact a member of our staff: www.surfky.com/contact
Copyright © 2014 SurfKY News Group, Inc.  •  Terms of Use  •  Site Map

social 06social 21social 22social 04social 03