Please help . I took out a life insurance policy about 8 years ago it is a whole life insurance policy and has some cash value .I recently discovered I have a group life insurance policy at work . Should I keep both or cash in the whole life insurance policy which is worth about 11,000 in coverage and 1,100 in cash value . The work policy is worth about 65,000 in coverage and 0 cash value
Please help . I took out a life insurance policy about 8 years ago it is a whole life insurance policy and has some cash value .I recently discovered I have a group life insurance policy at work . Should I keep both or cash in the whole life insurance policy which is worth about 11,000 in coverage and 1,100 in cash value . The work policy is worth about 65,000 in coverage and 0 cash value
You should determine what your life insurance needs are before you ever make any changes.
You should also NEVER count on your life insurance through work as being permanent. Things change.
There are too many points to make here. You should sit down with a local independent agent in your town and let him help you determine your actual needs. If you are in your working years you should likely have some term coverage (if you have a spouse and or kids.)
Make sure the local person you sit down with has many years in the business, and not someone in their first year. He also should represent MANY companies, INCLUDING NY Life, Pru and Met.
Make sure the local person you sit down with has many years in the business, and not someone in their first year. He also should represent MANY companies, INCLUDING NY Life, Pru and Met.
NY Life, Prud and Met? What if another agent represents say John Hancock, Illinios Life and AIG, and doesn't represent NYL, Pru and Met in your mind does that take them out of the running? I just never seen that combo being suggested in such a manner.
No, it does not take them out of the running. I just threw out three of the biggies since they have large portfolios and some (not all) of their options might be quite competitive.
Always keep your coverage outside of work. Unless you plan to work there until you die. That is not to say that you do not need a evaluation of your current life insurance. Seek out someone who is independent and can throw some quotes for other Ul or Wl policies they well worth looking into. One thing to take a look at is what they are crediting for interest on your policy. Are they at the minimum guarantee or are they crediting more. That is one thing to note when a policy might need to be replaced, if they hang out at the minimum for a extended period of time.
"I recently discovered I have a group life insurance policy at work "
All the reason to really think twice about dropping (maybe you should add) your personal policy. Right now the group life pays on the probability that you WILL die while employed with your current employer. Your whole life pays on the certainty that you will die someday. Which is better? When ya gonna die?
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You can turn your whole life policy into a "Paid up" policy. Check with your agent or company, this is easy to do. Generally, whole life is a rip off and generates lovely commissions for the agent that sold it to you. Term insurance is much much cheaper and provides a much greater death benefit than whole life.
A downside to group insurance is that it goes away if you leave the job.
Another option for your policy is to stop paying premiums and let it go on an extended term option. In other words the cash value will be used up over time paying for your 11,000 in coverage, but the covereage will convert to cheaper term. Once the cash value is used up the policy will terminate
Another option for your existing wholelife policy is to cash it in and use some of the proceeds to pay for a greater amount of term insurance depending on your need for additional life insurance.
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Originally Posted by grint
you can turn your whole life policy into a "Paid up" policy. Check with your agent or company, this is easy to do. Generally, whole life is a rip off and generates lovely commissions for the agent that sold it to you. Term insurance is much much cheaper and provides a much greater death benefit than whole life.
A downside to group insurance is that it goes away if you leave the job.
Another option for your policy is to stop paying premiums and let it go on an extended term option. In other words the cash value will be used up over time paying for your 11,000 in coverage, but the covereage will convert to cheaper term. Once the cash value is used up the policy will terminate
Another option for your existing wholelife policy is to cash it in and use some of the proceeds to pay for a greater amount of term insurance depending on your need for additional life insurance.
Most people are underinsured.
Gawd insurance is WAY boring.
Grint says: "Generally, whole life is a rip off and generates lovely commissions for the agent that sold it to you."
Gee Grint...you don't make lovely commissions on term insurance? You are WAY misguided if you think term is the correct solution for everybody and everything. Try doing a wealth transfer with term.
Term is a great product to insure your income for your family. But when you try to use it for tax planning, estate planning, or any permenant need you are very misguided.
I wouldn't think you should give specific cookie-cutter advice on an internet forum without knowing many more details of his situation. Very unprofessional.
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Originally Posted by Newby
Grint says: "Generally, whole life is a rip off and generates lovely commissions for the agent that sold it to you."
Gee Grint...you don't make lovely commissions on term insurance? You are WAY misguided if you think term is the correct solution for everybody and everything. Try doing a wealth transfer with term.
Term is a great product to insure your income for your family. But when you try to use it for tax planning, estate planning, or any permenant need you are very misguided.
I wouldn't think you should give specific cookie-cutter advice on an internet forum without knowing many more details of his situation. Very unprofessional.
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Buy term and invest the rest mentality. Personally, I never have agreed with this line of thinking. A Dave Ramsey grad perhaps?
I cannot verify this but I did hear a speaker at a local NAIFA meeting last year state that an agent was very successful in writing a large face amount UL policy to noneother than Dave Ramsey's wife. I would love to have been a fly on the wall when she revealed this to ol' dave.
Term is simple, you are betting you will die within the term limits while the company is gambling you won't. Sure, you can get higher face amounts issued in term a lot cheaper than WL, but as for me and my own, I'll personally take the EIUL"S over term any day.
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Grint,
Here's a question for you. If term only insures for a specific period of time and a whole life insures for a lifetime, which is a better choice?
Answer: depends on need.
What you need to understand is both term and whole life are good types of insurance depending entirely on NEED. You should be selling insurance products based on need. IF a client needs coverage for their entire life, would term work? Again the answer is depends. Depends on how long they live.
If you last in this business you will learn that every type of insurance sold has a purpose. Your job is to match that insurance and it's purpose to a person's needs. When a term policy just won't do it, what are you going to do?
If a client needs term, sell term. If a client needs permanent, sell permanent. Shouldn't be harder than that.
Insurance for dummies(life insurance)?
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