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Started By
Message
Term vs Whole Life
Posted on 9/18/13 at 8:20 am
Posted on 9/18/13 at 8:20 am
Figured this may be a topic that is beat to death on here, I looked several pages back but didn't see anything. Feel free to link previous threads that may have good info.
Leaning more towards term as to me the money spent on a full life policy could be better invested elsewhere and as long as I manage my other finances correctly by the time my term policy ends I should hopefully be in a comfortable state at or near debt free and have a substantial balance in my 401k/other investments to support my family in event something would happen to me after my term policy expires or becomes too expensive to afford.
Thoughts??
Leaning more towards term as to me the money spent on a full life policy could be better invested elsewhere and as long as I manage my other finances correctly by the time my term policy ends I should hopefully be in a comfortable state at or near debt free and have a substantial balance in my 401k/other investments to support my family in event something would happen to me after my term policy expires or becomes too expensive to afford.
Thoughts??
This post was edited on 9/18/13 at 8:45 am
8
Posted on 9/18/13 at 8:29 am to Tbooux
Both is usually the right answer
Posted on 9/18/13 at 9:29 am to Tbooux
If you are fiscally responsible then term for 20-30 years is the way to go and save the difference. In the best case you are able to self-insure after the term expires
Posted on 9/18/13 at 12:53 pm to txtiger21
That's my thoughts as well, the monthly cost for a whole life policy with enough coverage is just too much to swallow right now. Would have to seriously cut back!
Posted on 9/18/13 at 1:54 pm to Tbooux
Indexed universal life
Posted on 9/18/13 at 3:11 pm to Tbooux
only someone selling life insurance would recommend whole life..
Posted on 9/18/13 at 3:35 pm to Tbooux
I used to sell this for a living.
Whole Life is 100%, yes, 100% TAX-FREE. The benefit amount will never be touched by the government. Whole Life is way more expensive for much less coverage than you could get with Term. The policy is always in force, regardless of your health or situation, as long as you pay the premium each month/quarter/year or however you set up the payments.
Term is still 100% tax-free but will be much less expensive and you'll get way more coverage for less. You are only covered for a select number of years and when your "term" is over, your insurability will be worse. If you get a 10 year Term policy now, in 10 years you will be much less insurable than you are now so that same policy (if you choose to renew it) will cost you MUCH more at that time than it does now. You could get over $1,000,000 of term insurance at age 30 for approximately $40-50 a month. That same amount in Whole Life will easily cost a 30 year old over $375 a month.
Whole Life builds your own bank for yourself. You can borrow your own cash value that builds up in the policy over time at a low interest rate and you are never required to pay that loan back. Unpaid interest builds up and at the time of your death, any outstanding loan and interest will be deducted from the total death benefit.
Bottom line: If you are very wealthy and have an estate to protect from taxes at the time of your death, buy a huge amount of Whole Life insurance to protect your estate from taxes. If you are like a normal, middle class American, buy a shite load of term insurance for as long a term as you can find and a small burial Whole Life policy to always ensure your family has a settlement to bury you with so they don't have to come out of pocket at the worst time of their lives.
Make DAMN sure you go with a very reputable company. Don't get anything from Selectquote.com or any company you've never heard of before. New York Life, Northwest Mutual, State Farm, or any mutual type of company is your best bet. The first two I mentioned are the best in the industry. They'll always be there no matter what.
Whole Life is 100%, yes, 100% TAX-FREE. The benefit amount will never be touched by the government. Whole Life is way more expensive for much less coverage than you could get with Term. The policy is always in force, regardless of your health or situation, as long as you pay the premium each month/quarter/year or however you set up the payments.
Term is still 100% tax-free but will be much less expensive and you'll get way more coverage for less. You are only covered for a select number of years and when your "term" is over, your insurability will be worse. If you get a 10 year Term policy now, in 10 years you will be much less insurable than you are now so that same policy (if you choose to renew it) will cost you MUCH more at that time than it does now. You could get over $1,000,000 of term insurance at age 30 for approximately $40-50 a month. That same amount in Whole Life will easily cost a 30 year old over $375 a month.
Whole Life builds your own bank for yourself. You can borrow your own cash value that builds up in the policy over time at a low interest rate and you are never required to pay that loan back. Unpaid interest builds up and at the time of your death, any outstanding loan and interest will be deducted from the total death benefit.
Bottom line: If you are very wealthy and have an estate to protect from taxes at the time of your death, buy a huge amount of Whole Life insurance to protect your estate from taxes. If you are like a normal, middle class American, buy a shite load of term insurance for as long a term as you can find and a small burial Whole Life policy to always ensure your family has a settlement to bury you with so they don't have to come out of pocket at the worst time of their lives.
Make DAMN sure you go with a very reputable company. Don't get anything from Selectquote.com or any company you've never heard of before. New York Life, Northwest Mutual, State Farm, or any mutual type of company is your best bet. The first two I mentioned are the best in the industry. They'll always be there no matter what.
Posted on 9/18/13 at 6:21 pm to TDsngumbo
Term is the only way to go
Posted on 9/18/13 at 7:43 pm to Tbooux
The need for insurance is greater when you are youger..
As you age hopefully the things you insured as a younger person are paid for/matured..(house, land, your childern)
I used to sell insurace for 10 years and I sold a lot of it.
Id explain the difference between the two and show what X amount per month will get you...
FWIW I sold far more term policies than did WL.. especially anything over 100k face.
As you age hopefully the things you insured as a younger person are paid for/matured..(house, land, your childern)
I used to sell insurace for 10 years and I sold a lot of it.
Id explain the difference between the two and show what X amount per month will get you...
FWIW I sold far more term policies than did WL.. especially anything over 100k face.
Posted on 9/18/13 at 8:14 pm to TIGRLEE
why did you "used to sell" insurance?
Posted on 9/19/13 at 9:26 am to Tbooux
Term
Posted on 9/20/13 at 9:36 am to Tbooux
Depends on the situation, but in most cases: term.
Posted on 9/20/13 at 12:43 pm to SlidellBammer
quote:
only someone selling life insurance would recommend whole life..
Posted on 9/20/13 at 3:54 pm to kywildcatfanone
I have a policy with Northwestern Mutual and it is term but is good until I am 85 witH decade increases in premium. The dividend helps pay my premium down. And yes I know this is my first post and no I don't sell life insurance
Posted on 9/22/13 at 12:10 am to MsState of mind
Get a lot of coverage with term and buy a small whole life policy for burial costs now to lock in a low rate. Get a 20 hear level term policy, but aggressively save money through mutual funds or 401(k). Good luck!
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