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Here we go again with the economy and all of our investments. Just as I did a few years ago I need to dust off a bit useful suggestion and reach out again.

Investment counselors are trained to say that the market is cyclical and that you shouldn’t freak out in scary down times. That’s the same advice they’ve been giving for 50 years and, while I agree with not freaking out, I believe there is reason for them to take a look at what they’re saying in the context of the real world in 2011 and alter their guidance a bit.

Number one I think it’s important for investment counselors to be honest that this global economy isn’t the American economy of 40 years ago or even 20 years ago. Greece screws up and everyone pays the price now. Recovery might not really be in the picture and if it is, it will be after all the countries in the world come to grips with their debt. I guess what I’m trying to say is that I think our 401k’s are screwed for more than just the short term.

So, let me dust off some advice from 2008, especially if you are over 50. Buy enough term life insurance to make up for the losses that you have incurred from the lack of growth the last 4 years. My advice when the economy tanked last time was 10 year term. That’s when I was still buying into the market cycle thing. I now think it might be prudent to buy longer term life insurance and possibly even some permanent life insurance. Unless you have a crystal ball that tells you where the market will be when you die, you might want to consider ensuring that your wife will have something to carry on with.

I’m not suggesting busting your budget on life insurance, but even if it’s $100,000 or $250,000, when you die you can know that your spouse will receive it. I’ve had a lot of people wonder aloud how we can be confident that life insurance companies will stay in business and really pay off if we go into a depression or prolonged recession or double or triple dip the whatever. Guys, life insurance companies have money that countries only wish they had. If times get bad they can tighten their belt by paying guys like me less. If times get really, really bad they can sell themselves to companies that are so huge it’s indecent and by law they have to keep all of the original guarantees of your life insurance policy.

My net worth has taken a beating too. I’m right there with the rest of the world, but if I die my wife gets $1.8 million. If our assets shrink to 0, she has enough to pay off any debt and live comfortably without having to work if she so chooses. How often do we hear of wives left behind that have to work 2 or 3 jobs (if they can find them) just to keep the family fed and hopefully keep the house.

Bottom Line. This isn’t 2008. This is 2011 and whether it is just a hiccup or a bomb dropping, some inexpensive term insurance can sure put a family’s mind at ease.