Denzel Rodriguez breaks down buying three convertible term policies with staggered 10-, 20-, and 30-year terms instead of one big 30-year policy. You get a larger total death benefit, lower upfront costs, and spread out your conversion to permanent coverage over three decades as your wealth grows.
What you could do is you could buy two or three term life insurance policies convertible, and you could have one term that's a 10 year, one term that's a 20 year and one term that's a 30 year. What that allows you to do is your number one, you've just secured $3 million of death benefit and you diversified it over three different policies. And let's say you got the same health rating, which should be the case, you have the same health rating across all three, you have a total of $3 million of death benefit. But instead of having to be forced to convert all $3 million within the first 10 years, you're actually giving yourself time to convert over a 30 year window. And what that does is it makes the cost cheaper. So if I wrote you a 3 million dollar term for 30 years, it's going to be super expensive versus a 1 million for 10 years, 1 million for 20 years, 1 million for 30 years, it's going to be cheaper than the 1 million term for 30 years. That makes sense. That's another reason why some do that, because they're like, can I afford this? Number one, do I have the cash flow? And what's the most efficient way to secure my future net worth today? For the least amount, right? And then I'm basically giving myself 30 years to go work, produce, accumulate more wealth, increase my income, and then in stages I can start to convert these three term policies. So it's a very smart strategy, no doubt at all.
