Jeff Fouts: “Estate planning attorney, Jeff Fouts, here. I want to give you a little bit of what our philosophy is in regard to estate planning. You may say, ‘What do you mean your philosophy? I didn’t know you had to have a philosophy to do estate planning.’ Well, our firm does. Here it is – house insurance.
I have house insurance, and you probably have house insurance too. You, like me, have probably paid on it for five years, 10 years, 20 years, 30 years. You’ve paid the house insurance for decades, just like I have. We’ve spent, let’s just make up a number, $1,000 per year. If we spend $1,000 per year, that means in 10 years, that’s 10 grand ($10,000). Over 30 years, that’s 30 grand ($30,000).
You know what? We’re glad that we’ve never had to use our house insurance. We pay the insurance premium every year and without even any frustration with the insurance company. We just pay it every year. We just write them a check. We’ve paid that insurance company $10, 20, 30 thousand dollars, and we’ve never gotten any benefit at all from it.
How is it that an insurance company can insure a house for only $1,000 per year? Here’s how they can do it. It’s because the odds of your house actually burning down is just about zero percent. It will literally probably will never ever happen. How do I know that? It’s easy.
The first reason is because if we did in fact have houses burning down all the time, we would be able to see houses burning down on a regular basis in the neighborhood when we drove by, but we don’t. The second reason that we know that our house is probably never going to burn down is because insurance companies aren’t stupid. If our houses truly did have a significant chance of burning down, your insurance premiums and mine would be $10,000 or $20,000 per year, but the premium is only $1,000 or so.
If you and I care so much to insure our very home that we live in, even though it’s probably not ever going to burn down, if we’re prudent enough that we want to insure that asset, I think that we need to at least consider “insuring” all of the rest of the things we have and learn how to protect it so that no matter what the future holds we’ll have a solid plan in place.
There is a plan to protect it. If we could ever be of help you to discuss it, just give us a call, thank you.”