Who do you use for term life?

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Thinking of a 500k policy 20 year term.

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Age?

Actually I am glad this came up, been meaning to start a thread on life insurance. The Ms and myself need to get life insurance. We are 30 and have a 9 month old. I have life insurance currently through my employer but after looking at things I reliaze I need more. Anyone care to help with the basics?

Tia

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Anyone care to help with the basics?

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Your life insurance through your employer is almost certainly group. Very similar to term and is generally a really good deal until you hit 50. You might want to figure out what the "most" you can carry through the employers and do some comparison shopping.

At 30, you're probably going to look at 30 year terms and getting those early, while you're still in good health, can really shave off the long-term costs.

Stay away from whole life, generally. I'm not a "never" whole life guy, as it has value for certain estate planning or other applications, but purely from a "life insurance" standpoint, it is a costly luxury type product. Stick with term - major companies - get the cheapest that meets your needs. You probably need a little more than you think you do, but don't overdo the amount, either.

ETA: Back to basics -

Whole life - investment product that provides death protection, builds cash value and if you hold the policy long enough becomes permanent "paid up" insurance. Typically, you can get all of your premiums back at some future date (cashing out the policy), too, as an alternative.

Group life - death protection based on membership in a "group" (typically employment, but also things like military/veteran status, credit union, etc.)

Term life - X amount of death protection for a fixed Y amount of years. Generally, the younger you are, the cheaper it is. Price is risk adjusted based on your health.

I have a 2 term policies. One is with AIG and the other is with Farm Bureau.

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What's the logic behind the 15 years of gross income?

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Because the point of life insurance is to replace the deceased's person's income. Makes a lot of sense as a starting point for me.

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why gross income?

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I get that "net" income might be a better metric, as life insurance won't be taxed (although the proceeds from it will be, depending on investment vehicle).

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I could understand a multiplier of current expenses

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Multiplier of current expenses makes less sense than either gross or net income to me.

I think the compromise is probably net income.

Some companies are adding living benefits to their term death benefits. In effect, the death benefit (or a portion) would be accelerated to the insured while alive in the event of catastrophic illness or injury.

While these plans may not be the cheapest, they are certainly within $10-15 per month of the cheapest rates. Just an extra hedge against what life may throw your way.

Good luck in your search.

i'm about the same age. i am the only breadwinner in my household with 2 children. i have 2 policies of $1mil each. one with prudential, one with protective. both 20 year term policies that i got a few years apart. my goal was to have enough to get my kids into college without my wife having to go back to work, and hopefully cover as much of college as possible. both kids will be about done with college around when the terms expire. at that point, i should have enough to self insure.

i have a friend who is a financial adviser. i used him to get my policies. he priced a few and i picked the cheapest each time. i also looked into a couple other companies with dedicated advisers. i discovered that minor health issues mean different things to different companies. some are less concerned with your medications, etc. than others.

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We are 30 and have a 9 month old.

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I'm pretty close to your same situation, and I looked at 20yr term. My goal is to be financially independent in about 25 years, and I expect to be close enough to that goal in 20 years that my family would no longer need my income replaced at that point. You never know what will happen, but my hope/expectation is that 30yr term would be overkill for me.

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I have seen all debts & childrens schooling plus 15yrs of your gross income. That sound about right?

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I'm not an expert, but this seems like a LOT. I looked at a lot of different factors to get an idea of income replacement. I didn't use this as my rule of thumb, but I ended up right at about ~10x gross income. I didn't add current debt or child education to that.

ETA: YMMV on all of this. I just wanted to give a different perspective to think about.

I can give you a quote.
LINK /

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Because the point of life insurance is to replace the deceased's person's income. Makes a lot of sense as a starting point for me.

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How long do you think it will take your SO to find another man? She'll probably mourn for 6 months or so and then get back in the dating scene. Then probably be remarried within 3 years. So I really don't understand the point of 15 years worth.

Although, I did just calculate mine and it came up to about 15 years.

When the wife and I first got ours, we figured up paying off all debts (mainly mortgage) and the kids' schooling through 4 years of college and then have a couple hundred thousand left over.