Comments on: Shopping For Term Life Insurance And Why It’s A Smart Choice For Most Situations

By: Peter Anderson

Peter Anderson — Wed, 03 Mar 2010 21:13:40 +0000

I’d get term life for my wife as well, however, she has some serious health issues that preclude affordable life insurance.

By: Karen Foster

Karen Foster — Wed, 03 Mar 2010 21:00:44 +0000

Yup - TERM life. My husband and I both have it. Don't forget to have your wife get some as well (especially if she cares for the children). If she ends up passing away the insurance can cover childcare costs and enable you to continue working. Karen Foster´s last post ..Ladies, wake up and smell the dollars.

By: Kristine

Kristine — Mon, 01 Mar 2010 20:00:42 +0000

I purchased my first life insurance policy at 23 years old. It was a convertible term policy. This way I was able to lock the low premium rate. I converted to a whole life insurance policy a couple of years later. I got as much insurance as the company would give me, not 10 times my salary or 15 times…as much as I could get. I want to leave the most I can to the people I leave behind.

We all buy car insurance to insure our cars, homeowners insurance to insure our homes. These are just things. I believe in insuring our lives because we have so much value. We leave our legacies to our families, to our churches, to charitable organizations like the Susan G. Komen fund, or to research to help find cures for autism or Parkinson’s disease, anything you like.

I disagree with buying term and investing the difference. One big reason is because most of us will not invest the difference. Second, I find it’s better to invest in a vehicle you control like whole life, than a 401K or an IRA, because it is not subject to market trends. The cash value only goes up.

There are many advantages of whole life insurance like protecting your life value, it grows in a safe, accessible vehicle, and you have all the control. In my experience of investing in real estate, penny stocks, the 401k, Teacher Retirement, the IRA, my whole life insurance policy is the best thing I have ever invested in…hands down.
Kristine´s last post ..Rich Dad Poor Dad – The book that will rock your financial world.

By: Jeremy Walter

Jeremy Walter — Mon, 01 Mar 2010 14:13:57 +0000

Great article – a couple of thoughts to add:

1. I’d have to politely disagree with the comment to purchase renewable term. Unless you have a condition that may prevent your insurability down the road, the extra premium you’ll pay now won’t be worth it. And as you said, Peter, the goal is to be self-insured by that point.

2. We recommend our clients taking out life insurance coverages that covers three needs: the present value of all current debt, the present value for the monet needed to replace the lost income for X amount of years (largely dependent on child ages), and the present value needed to replace retirement savings that can now no longer be saved (not as applicable to younger families). I believe this formula, although trickier to calculate, is the best way of figuring out true life insurance needs.

By: Aaron @ Clarifinancial

Aaron @ Clarifinancial — Mon, 01 Mar 2010 13:21:29 +0000

Thanks @LeanLifeCoach. I was about to mention when you get quotes, it may be important to consider how each of these different places work. Some try to sell you insurance and actually offer fewer companies to choose from than many life agents. Some just sell your contact information to a bunch of different agents who will call/email you. And there is one that let’s agents compete for you anonymously and lets you control who contacts you after you see what they have to offer.

Again, the way you get quotes may not be that important to you. But for those who want to get competitive quotes without any hassle, it probably is.

By: David/Yourfinances101

David/Yourfinances101 — Sun, 28 Feb 2010 03:34:48 +0000

I have always heard that 5x your annual salary is a good amount to have. Does that sound about right? David/Yourfinances101´s last post ..Enter for a Chance to Win an iPad

By: Rich

Rich — Sat, 27 Feb 2010 05:04:59 +0000

Good information, most of which I agree with. I think the vast majority of folks are better off buying a term policy, especially in the early years of adult life. The vast majority of my business is term insurance, but I do have to say that recently it seems I have been trying to help a lot of older folks who are in the position of having their term policies end (well, the level period is ending, putting the premiums out of reach) yet still needing insurance.
Permanent policies have their place, they just need to be used properly as part of an overall financial plan. Dave Ramsey claims that all permanent insurance is “junk layered with fees”, but he is just flat out wrong. All life insurance costs the same amount–term or permanent–and all types of life insurance have fees. It saddens me to see that people following the “buy term” part of his advice often end up failing to “invest the difference”, leading them to my office where, often times, I can’t help them do to health or other related issues.
Anyway, not to stir the big “Permanent insurance vs. Buy Term Invest the Difference” debate, but there is more to consider than meets the eye.

By: LeanLifeCoach

LeanLifeCoach — Sat, 27 Feb 2010 01:45:04 +0000

Hey, we have a fellow Yakezie member that runs a no cost insurance quote system… http://www.clarifinancial.com you might want to check it out.

I bought a term policy using SelectQuote almost two years ago. The process couldn’t have been easier though the price could have been better! Then again, I am bit further down the road of life than you.
LeanLifeCoach´s last post ..Combat the Closing Techniques – The Power Of Suggestions

By: Darren

Darren — Fri, 26 Feb 2010 23:50:51 +0000

Just to add a bit to Ron's comment above. If you do transfer ownership of your policy, do it as soon as is feasible. Because if you transfer the policy within 3 years of your death, the full amount of the proceeds will still be included in your estate. Darren´s last post ..Unique Code

By: Evan

Evan — Fri, 26 Feb 2010 19:43:53 +0000

Peter,

Once underwritten it is not a bad idea to actually compare whole vs term options, and do the math. I did an example a few months ago:

http://www.myjourneytomillions.com/articles/give-whole-life-insurance-a-fair-comparison-get-illustrations-and-compare/

I also never really understood the 8 to 10 times your income, rather than 8 to 10 times your expenses? But that might lead people to be under insured since most people (not you lol) have no clue what they spend a year.
Evan´s last post ..Picking Dividend Aristocrat Stocks