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Term Life Insurance - What Would You Do?
Posted on 7/12/16 at 2:37 pm
Posted on 7/12/16 at 2:37 pm
Seeking $1M in coverage:
30-yr Term at $60/mo
20-yr Term at $35/mo - converts to $500k in coverage Universal Life for years 21 and on provided I keep paying the premium.
I'm 30, Kid #1 on the way. Will have more children and goal is to cover debts and ensure their educational expenses are covered through college.
30-yr Term at $60/mo
20-yr Term at $35/mo - converts to $500k in coverage Universal Life for years 21 and on provided I keep paying the premium.
I'm 30, Kid #1 on the way. Will have more children and goal is to cover debts and ensure their educational expenses are covered through college.
6
Posted on 7/12/16 at 2:46 pm to Golfer
I'd personally take option #2. Sounds like guaranteed insurable in 20 years, and possibly not losing some of the premiums you've paid. Sounds like means I don't know the details.
Posted on 7/12/16 at 2:53 pm to Golfer
Who is #2 through, and what is that premium at 51?
Posted on 7/12/16 at 3:08 pm to BigErn
Protective Life Ins. Co.
Premium remains the same. Goes to $500k in yr 21, then 10% reduction in coverage each year. So ~$210k in yr 30.
Premium remains the same. Goes to $500k in yr 21, then 10% reduction in coverage each year. So ~$210k in yr 30.
Posted on 7/12/16 at 3:34 pm to Golfer
Could you do option B, and $500K worth of option A?
Posted on 7/12/16 at 3:41 pm to Golfer
Find a 30yr term policy that is convertible throughout the entire term. If you convert, you can choose to only convert $500k of the $1M if you want. The conversion will be based on your current age and original health class rating (no medical required).
Some companies will only convert during the first 20yrs.
Check with Prudential...or find an agent who sells more than just one or two providers.
At 30yrs old, Preferred Best Health Class - Looking at about $66 Per mo. for a Prudential Policy that is convertible to all of their permanent policies throughout the term
Some companies will only convert during the first 20yrs.
Check with Prudential...or find an agent who sells more than just one or two providers.
At 30yrs old, Preferred Best Health Class - Looking at about $66 Per mo. for a Prudential Policy that is convertible to all of their permanent policies throughout the term
Posted on 7/12/16 at 4:40 pm to ram03reg
I would go with option 2 from what I've seen all day and twice on Sunday, take the difference and put it into a savings account if you want to feel better. Add it to your college fund or whatever.
If you are healthy and don't have a lot of debts, then you don't need a ton.
If you are healthy and don't have a lot of debts, then you don't need a ton.
Posted on 7/12/16 at 4:44 pm to baldona
quote:
If you are healthy and don't have a lot of debts, then you don't need a ton.
Healthy, but have a lot of debt with private school to cover for at minimum of 1 kid. I hope $1M is enough
Posted on 7/12/16 at 9:27 pm to Golfer
Do NOT take the UL option unless you are 100% sure how a UL works and that you're okay with it.
To put it simply -- a UL is a 1-year annually renewable term policy bundled together with a savings account. Part of your premium pays for your "insurance", based upon your current age. Another portion of your premium pays for the insurance company's expenses related to servicing your policy. The remainder of your premium earns a higher-than-average interest rate.
Problem is as you grow older, more and more of your premium goes to paying the cost associated with insuring your life (based upon the mortality rate of your age in any particular year). This means less and less is earning interest. Eventually, your cash value will have to be dwindled in order to pay your cost of insurance. If you don't increase your monthly premium, your policy will run out.
Take the 30-year term for $60/month. You'll do much better over time.
To put it simply -- a UL is a 1-year annually renewable term policy bundled together with a savings account. Part of your premium pays for your "insurance", based upon your current age. Another portion of your premium pays for the insurance company's expenses related to servicing your policy. The remainder of your premium earns a higher-than-average interest rate.
Problem is as you grow older, more and more of your premium goes to paying the cost associated with insuring your life (based upon the mortality rate of your age in any particular year). This means less and less is earning interest. Eventually, your cash value will have to be dwindled in order to pay your cost of insurance. If you don't increase your monthly premium, your policy will run out.
Take the 30-year term for $60/month. You'll do much better over time.
Posted on 7/12/16 at 11:12 pm to poops_at_parties
I understand how a UL works. Ideally in 20 years I'll be in an asset position where I won't need $1M of coverage, but will still need some for the next ~10.
Posted on 7/13/16 at 5:18 am to Golfer
I have 20 year term for 1M pay about the same without the option, but also no debt.
THat said, I probably take 30 in your shoes. Covers kid and maybe future kid through college
THat said, I probably take 30 in your shoes. Covers kid and maybe future kid through college
Posted on 7/13/16 at 6:59 am to ItNeverRains
Go with 30 years fully convertible. I have used Pru, Lincoln and Banner. Banner is by far the easiest to get issued.
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