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FJRChick

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I'm finally setting up independant (not supplied by my work) life insurance and the sales guy is trying to convince to go whole life.

I'm almost 37, female, make a good living and I estimate an empty nest in 7 years.

I'm mostly recovered from the financial tsunami of my brother's transplants recovery and am basically at ground zero.

I need to put money currently paying debt to somewhere for my future.

I thought life insurance was to bury you (I think my veteran benefits cover that), and to not leave your family in a mess.

What do you think?

P.S. I promise your opinions will not be legally responsible for any of my future stupidity :)

 
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WOW

We must be on the same wavelength so something... LOL

I have a Term Life policy and it pays better than Whole Life. You might check into that option

Adam

 
excellent questions...

life insurance is to help replace your income in case of death for those who count on you.

most people would be fine with an inexpensive 20 year term life ins policy at 8-10 times your yearly income.

If you make 50k income, you should get $500,000 policy...that way the family can invest that money and draw a yearly income of about $40k without taking from the $500k which basically replaces your income. (assuming 12% rate of return off investments)

I recommend Zander and here is an excellent book to help you with all financial matters.

feel free to pm for any additional help.

(I have no affiliation with either of the above)

 
I'm finally setting up independant (not supplied by my work) life insurance and the sales guy is trying to convince to go whole life.I'm almost 37, female, make a good living and I estimate an empty nest in 7 years.
Term will cover you for oodles less and you can invest the difference for yourself.

I am fee based Financial Advisor (never do commissions, ever) and see the insurance brokers pushing people to "over insure" all the time. I manage about $50 million for folks. Stay away from any Insurance product that is supposed to serve as an investment too...you will end up with mediocre insurance and a bad investment.

PM me if you would like some additional (and free) advice.

 
I'm finally setting up independant (not supplied by my work) life insurance and the sales guy is trying to convince to go whole life.I'm almost 37, female, make a good living and I estimate an empty nest in 7 years.

I'm mostly recovered from the financial tsunami of my brother's transplants recovery and am basically at ground zero.

I need to put money currently paying debt to somewhere for my future.

I thought life insurance was to bury you (I think my veteran benefits cover that), and to not leave your family in a mess.

What do you think?

P.S. I promise your opinions will not be legally responsible for any of my future stupidity :)
I'm a tax guy not a financial guy, but

TERM

Massachusetts Savings Bank Life Insurance had good marks in Consumer Reports - I'm not sure if they cover your area

My insurance is level premium for 30 years so I know what I'll be paying down the road. My life insurance will end when the kids are out of school and I imagine that will be around the time I retire too.

You can prepay your funeral too if thats the only reason for the insurance. Nursing homes can't get at the prepaid funeral either.

Now I've got to get back and churn out some more tax returns

 
with all due respect to the folks who responded-- if you are suggesting that a 500K term policy is better than 500K wl policy, you dont truly have a clear picture of how these things work. Additionally, if you think you will only need 10 or 20K after your kids leave you need to talk to people who are in their golden years -- people who are there.

Yes , whole life policies are much more expensive at the onset than term, but they never go up, they abridge usually after 20 or 25 years, the death benefit increases with Paid Up additions, and renewability is never an issue (as it usually is with term after age 80).

Oh, and by the way, you should be incorporating your retirement planning with your life cover. For example, your retirement Income fund options and pension options are reliant upon protecting your spouse (if you have one).

Am I saying Term is bad-- ABSOLUTELY not. Both types have a purpose, and PROPER planning incorporates both, plus some Universal life cover. Talk to the multi-millionaires around you -- the folks who have the best CPA's doing their retirement planning -- look at what they do.

When people have a problem with issues around the policies they bought , they come see. The young ones (uinder 65) want term. The old ones want whole life (and usually cannot get it) . I dont sell insurance,, I get others to straiten out their mistakes. If I had a nickel for all the folks who changed their tune about term/whole life as they grew old , .... well, lets just say life is good..... :rolleyes:

 
Whole life is one of the worst financial products on the market today. It is very expensive, so take the difference in policies and invest to become self insured. There is never a time when it is financially wise to have a whole life policy. The only time you should have whole life is if you already have one and can’t get any other form of life insurance.

Dont take my word for it, just look at the numbers:

For example, a 30 year old can buy a $500k term life policy for $420 a year vs. $3600 per year for Whole Life. That's $3180 difference....why the difference...mostly fees.

After 20 yrs of investing your difference in a mutual fund making 12% return, you will accumulate over $256,000.

You have just become self-insured. Plus, by then you have accumulated wealth within your retirement plan...never use insurance as your retirement plan.

This does need to be part of your entire financial planning: Be debt free, have an emergency fund, health insurance, TERM Life Ins., and invest 15% for retirement.

OK....soap box ended. :winksmiley:

 
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