Hello, everybody. It's Sam from Financial Samurai. I hope everybody had a wonderful Thanksgiving. I know I did. I finally got my parents to come visit us after three years of being away thanks to COVID. Three years, that's just way too long. And it's kind of sad, really. This is the biggest downer of the pandemic, keeping families apart.

And so three years is the entire life of my daughter. So better late than never. But at their age, it's even more important to spend time with them. So I hope all of you guys get to spend time with your loved ones as well this holiday season. Another thing I hope for is health, good health.

This winter has been pretty tough, especially for parents with little children. We're going through this tridemic of flu, RSV and COVID-19. My poor little guys, sniffling, coughing for two and a half months, and then my wife got sick, and then I got sick. So when I was sick, I just focused on writing, writing as much as I could.

Because I couldn't speak, I couldn't record, I was just coughing. And you know, you can even hear me now I have someone of a hoarse throat. But things are better now. And I'm going to take full advantage and start recording again. So this is kind of an example of trying to make lemonade out of lemons.

You know, when we're physically down and out, I think we can use our minds. And when our minds are down and out, I think we should go out there and play and be physical and utilize our bodies because there is this mental to physical connection I think we all have, which is important to nurture, nurture them both for better health, mental and physical health.

Speaking of mental health, if you have been feeling more anxious since the pandemic began, that's totally understandable. I think all of us have had some uptick in anxiety because of the fear of the unknown uncertainty, and even death, unfortunately. So I stumbled across this article on CNBC that highlighted how much life insurance demand increased since 2020.

And so finally, I was able to quantify how much more anxiety we are actually feeling. Because reconciling the two in terms of feeling and data is a good way to understand whether what we are feeling is logical or not, whether we are normal or a little bit crazy for the way we're thinking and feeling.

So this data, if you click over to the post, shows that life insurance application activity was up 3.4% in 2021, after a record breaking 3.9% in 2020, according to the MIB Life Index's 2021 annual report. Now 3.4% and 3.9% doesn't sound huge, you know, especially with, you know, stocks going up and down 10 plus percent.

But these numbers are huge for the life insurance industry, which is relatively stable. And I suspect once the 2022 data comes out, demand for life insurance will also be up again. But what's more interesting, what's more interesting is the 15.4% and 11% increase in what life insurance paid out in the form of death benefits for 2020 and 2021.

And this is according to the data from American Council of Life Insurance. This double digit yearly increase in death benefit payouts is massive. Just think if you were running a business where your costs were up 11 to 15.4% year over year, but your revenue in terms of life insurance premiums collected was only up between 3.4 to 3.9% during the same period.

You hope your expenses will normalize as mortality rates revert back to the mean. In other words, people go back to living longer based on trend. However, you're not exactly sure when or if this will ever occur. At the same time, you also fear the long term repercussions of COVID, which could lead to higher mortality rates, i.e.

earlier deaths and fewer premiums paid. So what are you going to do? Well, if you are a life insurance company, you are going to raise premiums to make up for lower profitability, especially publicly traded life insurance companies, which have to answer to its shareholders. And one way to justify raising premiums is by implementing COVID related questions in the future.

So you can imagine, you know, it's probably going to take five, 10 years to see what are the repercussions of COVID for mortality rates, your life expectancy, right? We don't know the exact implications of COVID because there's long COVID and who knows how that will affect us. And there's also the repercussions of the vaccines.

We think they're safe, but nobody really, really knows until maybe 10, 15, 20 years later. So you can see a situation where next time you want to get life insurance, let's say in five years or 10 years, there'll be a questionnaire that says, have you ever got COVID? And you say yes.

And in the algorithm or their calculations or underwriting, they might bump up your premiums by 3% from the baseline. And if you say, oh, you got the Moderna vaccine, they might bump it up by another 1 to 2%. And if you say, well, you have long COVID, well, maybe your premiums go up by 20%.

And then there might be a question on how many times did you get COVID? And the more times you get COVID, the higher your premiums go. So if I were a betting man, which I absolutely am, and I'm also a logical thinker, I expect life insurance carriers to raise premiums to account for higher COVID risk.

It's probably not going to happen now or next year, but it's certainly I think going to happen in three to five years time, because why not? They can use COVID as a green light to charge higher premiums, thereby increasing their profitability, or at the very least, losing less. It's totally rational.

After I published my post on life insurance demand, I actually found an amazing chart from the CDC that highlights life expectancy at birth by sex in America. And I put that chart and the data in the post. And if you look at the chart, this is the first time in 21 years, at least that life expectancy has declined.

And not only has life expectancy declined in America, which is pretty low already versus how much we spend on health care, and versus other developed nations, the life expectancy has declined a lot. You would expect maybe a you know, 0.1 to 0.3 year decline in life expectancy per sex, but not a two to three year decline in life expectancy.

The decline is pretty shocking. Now, hopefully, the life expectancy line will revert back to trend in several years, but you just don't really know. Therefore, it's best to lock in an affordable term life insurance policy before premiums go higher. And to recap, the best age best age range to get life insurance is about 30 to 35.

And the pest term duration is about 30 years. Because at 30 to 35, your premiums aren't very expensive. But after 3035, your life gets a lot more complicated, especially if you want to get married and have children buy a home with a mortgage and take care of your elderly parents.

Life gets much more complicated. And also, you will notice many more people have health issues. And unfortunately, many more people pass away once you're in your 40s and 50s. It's very apparent to me folks at the age of 45. Right now, I have some little annoying health issues, you know, with my ear, my hip pops, my shoulder hurts, it's probably because I play too much tennis.

But you know, I had a shortness of breath issue during the pandemic. And I probably attribute that to increased anxiety and also a relapse of my asthma, which I had as a child. And so these things as they collect on your record, when you go see doctors for your health issues, will be on your health record.

And then the life insurance companies will find out what you got, because they have a legal right to and then they will charge you accordingly. Straight up, one of my biggest financial mistakes was only getting a 10 year term policy in 2013. That was four years before our son was born.

And at the time, I was like, okay, a year out of my early retirement job, I should probably get life insurance because I have this big mortgage. So I was being responsible for getting a life insurance policy equal to the amount of my big mortgage. Because if I were to pass away, my wife at the time would have a very difficult time paying that mortgage based on her existing income.

But I failed, I failed to forecast the future that we would have two kids, and we'd have a much more complicated net worth. I also failed to realize that going to a sleep center, there's a brand new fancy sleep center in downtown San Francisco, was also going to result in me getting charged a lot more for my life insurance policy upon renewal.

So when I was 40, when I turned 40, my premium went from $40 to $450 a month. I mean, that's ridiculous, right at 40 years old. And that's with USA where I've been a member for 20 years, and I have multiple insurance policies. And during expiration on January 2023, my premiums are going to renew to $750 a month from $40 a month.

So that is outrageous. And that's something that obviously I'm not going to pay. So thankfully, thankfully, I spent time December 2021 shopping around online with Policy Genius and I found an affordable policy with no medical exam through SPLI for $110 a month. And it's a $750,000 term coverage. It's not the million dollars that I had, but more than 250,000 wealthier than I was 10 years ago.

But it gives me so much peace of mind. It's not just you know, paying an affordable amount of $110 versus $750 at the age of 45. It's just getting this policy renewed for another 20 years until my kids are 25 and 23 years old. That's pretty hopefully a mature enough age for them to understand what's right and wrong and have good personal finance fundamentals so they can be independent folks.

So what I realized today, especially after seeing the life insurance payouts up 11 to 15 and a half percent in 2020 and 2021 is that me getting life insurance, you getting life insurance is not just about getting that death benefit to help help your survivors live life once you're gone.

But it's also providing you a peace of mind that really is quite valuable. As soon as I got my new 20 year term policy, I felt a tremendous sense of relief. I mean, I would spend way more than $110 to feel the relief that I experienced now and the much less anxiety that I experienced now.

I mean, to quantify, maybe I'd be willing to spend $1,000 a month for this type of relief. I know some people spend $1,000 a month seeing a therapist for their problems. So it's just a realization that as a parent, you know, as a middle aged parent, you've got your kids to take care of, you've got your parents to take care of and think about.

It's about anxiety minimization and stress management. And that's what life insurance has provided me and my wife. I hope everybody stays healthy and safe this holiday season. If you haven't gotten life insurance, I highly recommend you get an affordable policy. I do think premiums are going to go up thanks to COVID.

Also, if you want to cancel at any point in the future, you can. This is something I failed to realize at the age of 35. I was thinking to myself, okay, if I sign up for a 10 year policy, that means I have to pay for 10 years the premiums to get my insurance.

Well, that's not true. It's a term policy you can cancel whenever you want or need to. Alrighty, folks. In conclusion, if you want to shop around for affordable life insurance, check out Policy Genius at financialsamurai.com/pg. You can get free real quotes based on your situation. I'll talk to you folks later.

It's time to rest my voice.