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Do you carry Life Insurance?

Posted By: ZZman

Do you carry Life Insurance? - 06/05/18 02:50 PM

Life can sometimes bring tragedy. Financial pressures as a result can be very stressful. Are you prepared or take your chances?

My wife and I have had term life insurance since the kids were born over 32 years ago. But as the terms expired and our ages have increased, we have had to lower coverage to keep the premiums reasonable.

I just couldn't imagine leaving my family struggling if something happened.
Posted By: sasilverbullet

Re: Do you carry Life Insurance? - 06/05/18 02:57 PM

Seems we're about the same age.

It depends on what you're wife would need if you pass. I had to go down to 100K when I hit 60, was at 500K.

Not cheap, but shop around, you should be able to get 100K for around $100 a month.
Posted By: robertcope

Re: Do you carry Life Insurance? - 06/05/18 03:00 PM

Of course. At 41, with a wife and a five year old, it would be crazy not to. At the very least, I want my wife to be able to start clean with zero debt.
Posted By: cashmoney

Re: Do you carry Life Insurance? - 06/05/18 03:11 PM

Absolutely no need for life insurance as you age and kids are gone assuming you have built a reasonable retirement fund and have the house paid off.
Posted By: WobblyElvis

Re: Do you carry Life Insurance? - 06/05/18 03:12 PM

Without young children I see no reason to carry life insurance. I had term insurance when I had dependent children but it's simply not necessary any more.
Posted By: opus1

Re: Do you carry Life Insurance? - 06/05/18 03:18 PM

Bare bones through work. No family to support after I leave so if it happens, the funds will be more than enough to plant me and throw a nice party for anyone who shows up.
Posted By: Astro14

Re: Do you carry Life Insurance? - 06/05/18 03:23 PM

I carry quite a bit right now at 55. Mostly term. I've got obligations - college, replacement of my income for my wife, etc.

But, as I hit 60 (one policy ends), then 65 (the other policy ends), the insurance will gradually dwindle from what it is now (about ten times my income) to $100,000, a small policy bought when I was 20 years old, and it will serve to provide some liquidity to ease the costs of my passing.

The large policies that exist now will be replaced by the value of our investment portfolio. Once it reaches "critical mass", there won't be a need for insurance. If I die (or, more properly, when) after 65, then that portfolio will be more than enough for my wife to live on. Why pay for insurance at that point?
Posted By: supton

Re: Do you carry Life Insurance? - 06/05/18 03:24 PM

Yes. I had a few times my salary once we bought a house and start a family; wife got a policy worth quite a bit less. Just in case. They were to cover us if the worst happened.

But when their terms are up, they are done. I'll self insure via savings. Once I hit 59.5 I have access to my 401k, and hopefully long before then I'll have money squirreled away elsewhere. I shouldn't need it once past age 50, if I play my cards properly.
Posted By: ffhdriver

Re: Do you carry Life Insurance? - 06/05/18 03:49 PM

Also remember a good way to reduce after death costs is to pre-pay/arrange your funeral. Prices really go up each year.
Posted By: MNgopher

Re: Do you carry Life Insurance? - 06/05/18 04:09 PM

With a wife, kids, mortgage obligations, etc, yes. We carry more than enough on both of us to cover the mortgage to pay off the house, cover funeral and estate expenses, and provide for a decent start on a college education for both the kids. Other than the Mortgage, we are debt free, so eliminating that expense in the event one of us goes is a major goal.

Posted By: zzyzzx

Re: Do you carry Life Insurance? - 06/05/18 04:13 PM

Do you carry Life Insurance?

No, other than what's provided through my employer. It would be a waste of money.
Posted By: 02SE

Re: Do you carry Life Insurance? - 06/05/18 04:34 PM

No need for life insurance. I do have a Will that covers all assets.
Posted By: ARCOgraphite

Re: Do you carry Life Insurance? - 06/05/18 04:39 PM

Well, I was on SSA.GOV and I read your Spouse will get your Social Security benefit if you croak. When? I don't recall.

I have big pile of cash in my 401K.

I carry 2x Annual salary policy through work. Cheap enough
all of the above should be enough for her.

I have no children or goats or kids.

I DO have a niece that I helped through College and She is now a cable news line producer at 30Rock in NYC making 2x more money a year than I ever made during my career peak in the early Y2K smile
I'm happy about that outcome smile
Posted By: bradepb

Re: Do you carry Life Insurance? - 06/05/18 04:40 PM

I can maybe see having a large policy for parents with young children who need to be raised.
Me, however at 61 with no debt and a decent amount saved and my wife set for a pension and large inheritance it would be foolish.
Posted By: opus1

Re: Do you carry Life Insurance? - 06/05/18 05:20 PM

Originally Posted By: ffhdriver
Also remember a good way to reduce after death costs is to pre-pay/arrange your funeral. Prices really go up each year.
And less stress on the family trying to figure out what you would have wanted.
Posted By: Astro14

Re: Do you carry Life Insurance? - 06/05/18 05:22 PM

Originally Posted By: bradepb
I can maybe see having a large policy for parents with young children who need to be raised.
Me, however at 61 with no debt and a decent amount saved and my wife set for a pension and large inheritance it would be foolish.


Agreed.

Insurance is a bridge, to cover the gap, until people reach the place that you've reached.

Well done. cheers
Posted By: Brybo86

Re: Do you carry Life Insurance? - 06/05/18 05:26 PM

Originally Posted By: bradepb
I can maybe see having a large policy for parents with young children who need to be raised.
Me, however at 61 with no debt and a decent amount saved and my wife set for a pension and large inheritance it would be foolish.

Agreed
Posted By: pandus13

Re: Do you carry Life Insurance? - 06/05/18 05:51 PM

I had whole life and term for about 8 years.
This year i shopped again and got term + IUL for less than I was paying before for just term with better benefits.

I am 43, with kids and (for now) sole bread-winner in the family. But only mortgage as debt.

Unfortunately, the offers from my places of work are/where too expensive than what i found on the open market (older or mfg places)


P.S. ZZMan, very good responses from the knowledgeable BITOG folks. I give this thread a 10 out of 10.

P.S. 2: paraphrasing Dave Ramsey, It is not Life insurance but (knock on wood) Death insurance....
Posted By: Johnny2Bad

Re: Do you carry Life Insurance? - 06/05/18 06:19 PM

On both my property mortgages (also disability insurance). When I die the mortgages are paid in full. The value of those properties easily takes care of my obligations, with money left over. If I manage to live 10 more years, they will be paid in any case, but I suppose I could always re-mortgage to take some equity out.

I don't have direct heirs, so there will be plenty of cash in the estate to make some distant relatives and friends happy.

If I had a wife or children, there would be conventional life insurance as well.
Posted By: csandste

Re: Do you carry Life Insurance? - 06/05/18 06:48 PM

My widowed mother was a mutual fund sales person before there were many no-loads. All I ever heard growing up was "buy term and invest the rest", which I did. I have low seven figures socked away and absolutely no insurance since my kids (thankfully) left home.

However, in putting as much away as possible into tax deferred products, I'm now over seventy and hit hard with minimum withdrawals on my IRA. My taxes have tripled since retirement.

I keep seeing more and more insurance as investment spiels, if I seriously looked into these, my mother would probably rise from the grave and hit me with a fund prospectus from 1963 "insurance isn't an investment, dummy"...

Has anyone actually used insurance as an investment vehicle? My suspicion is that such products are fraught with large, hidden fees. My girl friend fell for a bunch of annuities and I was shocked at how much money for the agent was hidden in there. Still....am I missing something?
Posted By: 4WD

Re: Do you carry Life Insurance? - 06/05/18 06:50 PM

I have a couple one is 2x annual salary and one about 1-1/2 Plus good savings from long term employment
Posted By: Patman

Re: Do you carry Life Insurance? - 06/05/18 07:16 PM

I have a policy that pays out $200,000 to my son that I pay $20 a month for. I initially got this policy when I was 32 years old and am now 48. The price would be much higher if I tried getting this same policy today. Lucky for me I'm locked in at this price forever. My wife and I looked into getting life insurance for the mortgage on our new home and it would be about $500 a month! At that price it's not worth it, if one of us dies, the other one will just sell the house, pay off the mortgage and downsize.
Posted By: pandus13

Re: Do you carry Life Insurance? - 06/05/18 07:18 PM

Originally Posted By: csandste
...
I keep seeing more and more insurance as investment spiels, if I seriously looked into these, my mother would probably rise from the grave and hit me with a fund prospectus from 1963 "insurance isn't an investment, dummy"...

Has anyone actually used insurance as an investment vehicle? My suspicion is that such products are fraught with large, hidden fees. My girl friend fell for a bunch of annuities and I was shocked at how much money for the agent was hidden in there. Still....am I missing something?

I would not look as investments.
Last I checked their projections where 6%,9%, 12% on a good year. (while others in the market where doing 20-25%).
I would look as having some money grow tax-free (depending on product and company offering it....)

A broker would be best for something like this because of comparing/cross-shopping.

With the other, you will find out the rest when you sign the 39+ pages....

To find out more, look for the financial literacy free classes in your area. they usually will have guests from major companies and answer questions.
Your local YMCA or elder community center may have free classes once a year also.

Also, for your girlfriend case, I would call the company with the policy in front of you and get them to explain ALL benefits, fees and obligations to you.

Posted By: JohnnyJohnson

Re: Do you carry Life Insurance? - 06/05/18 07:41 PM

Yes I have a permit to carry!
Posted By: csandste

Re: Do you carry Life Insurance? - 06/05/18 07:49 PM

I did get my GF away from a mercenary (who should have his license pulled) and into a Schwab dealer. I've consolidated various Vanguard and TRP accounts with Schwab and they are even cheaper than Vanguard-- although the line I've read on Bogleheads is the difference in cost would get you a ham sandwich after twenty years.

Interestingly the Schwab guy had never sold an annuity in his life, had to refer to San Francisco. She did get things changed over to another annuity that was much cheaper but they're hard to get out of without big tax consequences. I'm lucky to have a pretty good retirement system from sucking at the nipple of working in government my entire life. I suppose old style retirement plans operate a bit like annuities so I never needed one.

About all I'm doing is moving additional funds from my regular IRA to my Roth to avoid even more pain in the future. Advice to anyone young-- take the match on any 401/403/457 and put as much as you can into a Roth. I know a lot of people who have fallen for the old line that your tax rate will be less in retirement--it may not.

Been to a lot of investment, money courses and seldom learn anything new-- other than I don't learn anything new.
Posted By: MasterSolenoid

Re: Do you carry Life Insurance? - 06/05/18 08:07 PM

Originally Posted By: ffhdriver
Also remember a good way to reduce after death costs is to pre-pay/arrange your funeral. Prices really go up each year.

For younger people:
Pre PLAN ......YES
Pre PAY ....... NO

Reason: For alot of people, too many things in life can change, you may not want to be locked into one Funeral Home.
I think most people would benefit from having an Emergency Fund they can use throughout life.
But you might want to PRE Pay if you were getting up there in years.

To answer the OP question: No Life Insurance for me.
Posted By: madRiver

Re: Do you carry Life Insurance? - 06/05/18 08:11 PM

I have life insurance of $500k. It really is not that much considering the lost income but at least pay off the mortgage and leave a cushion for wife/3 kids for two years of lost income.
Posted By: csandste

Re: Do you carry Life Insurance? - 06/05/18 08:12 PM

Originally Posted By: MasterSolenoid
Originally Posted By: ffhdriver
Also remember a good way to reduce after death costs is to pre-pay/arrange your funeral. Prices really go up each year.

For younger people:
Pre PLAN ......YES
Pre PAY ....... NO

Reason: For alot of people, too many things in life can change, you may not want to be locked into one Funeral Home.
I think most people would benefit from having an Emergency Fund they can use throughout life.
But you might want to PRE Pay if you were getting up there in years.

To answer the OP question: No Life Insurance for me.




Agree entirely, although sadly I prepaid about 25 years ago. You'd be surprised at the difference in price for a cremation urn at the funeral home vs. Amazon. You can find people of shake and bake your ashes pretty cheaply these days and you don't need the help of a funeral home to put on a pretty nice memorial service. I think watching several years of "Six Feet Under" made me cynical-- funeral directors and insurance salesmen-- avoid 'em both.
Posted By: Sam_Julier

Re: Do you carry Life Insurance? - 06/05/18 08:42 PM

I carried whole life, term life and disability insurance while working (about 30 years) and took out a long term care policy 18 years ago. As the children graduated from college and provided for themselves the whole life was cashed in and the term life terminated. The disability policy was terminated when I retired. The long term care policy is still in force. The value of our assets plus pensions will carry us after my wife retires in 3 years. We plan to move to SC or NC which will reduce our expenses significantly. We have no debt or mortgage.

As far as "avoiding insurance salesman": I have a number of friends who lost a spouse when they had young children. Those with insurance managed to educate their children well and lead a prosperous life. Those without significant insurance struggled, some terribly.

Sam
Posted By: Schmoe

Re: Do you carry Life Insurance? - 06/05/18 08:46 PM

I get it through work...about 3 times my salary and then a little extra, around 300K and about 500K in 401k, but when I hit 55 this year, this premium will go UP. Just got the house paid off, so I'll drop it down some. Wife is 6 years younger than I am and is a RN. I'll keep some, but I'll be danged if I'm going to leave her a rich widow!!!LOL.
Posted By: PeterPolyol

Re: Do you carry Life Insurance? - 06/05/18 09:00 PM

Absolutely do not carry a price on my life, and never will.
Posted By: ZZman

Re: Do you carry Life Insurance? - 06/05/18 10:42 PM

My mother in law has no life insurance and no savings. Guess who is gonna pay?
Posted By: Nyogtha

Re: Do you carry Life Insurance? - 06/05/18 10:49 PM

Once I retired I no longer carried term life insurance. My wife who's still working still carries term life insurance but that'll stop when she retires. Our philosophy is life insurance is for use of lost current & some future income. No salary, no insurance.
Posted By: Astro14

Re: Do you carry Life Insurance? - 06/05/18 10:50 PM

Originally Posted By: PeterPolyol
Absolutely do not carry a price on my life, and never will.


Is anyone dependent on you?

What would they do if you were to die unexpectedly?
Posted By: Leo99

Re: Do you carry Life Insurance? - 06/05/18 10:58 PM

I carry about a half million on myself. Costs like $60 a month or thereabouts expires when I turn 70.
Posted By: Shannow

Re: Do you carry Life Insurance? - 06/06/18 12:10 AM

Originally Posted By: Astro14
Originally Posted By: PeterPolyol
Absolutely do not carry a price on my life, and never will.


Is anyone dependent on you?

What would they do if you were to die unexpectedly?


I agree with both of you...
Advice that I give the young engineers when they come to work and start a family is to carry income protection and life insurance...then get their affairs in order and rationalise on the insurances.

Leave your family destitute because you raced cars/bikes on the weekend and died...you're not a very good provider.

Only life insurance I (we) carry is incorporated in our superannuation schemes. Prvides a few hundred K for death/permanent disability.

Re income protection, I've accrued 2 years of paid sick leave...and a year of long service leave. I can get sick, get sick and die, or take a few months to change careers without impacting the family. (no debt helps too).

If I left and got another job, I'd think about income protection, as I've got 10-12 years before I can touch my retirement stuff.
Posted By: WhizkidTN

Re: Do you carry Life Insurance? - 06/06/18 12:42 AM

As I'm sure others have mentioned, you buy life insurance to replace your income only for a time when it is needed and you are not yet self-insured (meaning that your 401K/IRA/investments could generate the same income as your working income).

Term insurance is a great product when you purchase it for say a 30 year level term when you are younger, have a family dependent on your income and are not yet self-insured. At retirement age, you should have all your dependents gone (except your spouse!!), be out of debt or nearly so, saved enough over your working lifetime to retire and have that nest egg generating the income you need for your foreseeable life expediency. A very small portion of those same funds would pay for your funeral.

Research "The Theory of Decreasing Responsibility" to see better how this should work. Make sure you also have a will in place (and some states require you to file it with the State) and a written down plan for what you want at your funeral "just in case", i.e., please just cremate me, a celebration of life, etc.

Barring having those things taken care of at the proper time, life insurance can fill the gap as needed and ONLY for a specific time frame. Having life insurance for your entire adult lifetime is amazingly wasteful (i.e., read stupid) despite what some goober life insurance salesmen might tell you.
Posted By: Eddie

Re: Do you carry Life Insurance? - 06/06/18 01:11 AM

Only enough to plant me.
Posted By: alarmguy

Re: Do you carry Life Insurance? - 06/06/18 10:52 AM

Originally Posted By: cashmoney
Absolutely no need for life insurance as you age and kids are gone assuming you have built a reasonable retirement fund and have the house paid off.


^^That^^

As long as your debt free, paid for home and your spouse either works or you have a reasonable retirement account, why give your money to an insurance company?

Results vary depending on your age.
Posted By: Spector

Re: Do you carry Life Insurance? - 06/06/18 11:41 AM

carried close to 1 mil for many years but then had a very old universal (guaranteed 6% int on the CSV, yeah an old policy) I was still paying on 2,400 a year for 300,000 of ins. decided I no longer wanted to pay so got company to quote me how much life I could get with no more premiums. So, stopped premiums last year, have 233,000 but I have to make a decision at age 75, that is when the CSV will start to drop significantly each year and by age 85 all ins will be gone. So at 75 I can get about 75,000 of CSV out of policy or let it ride and be out of CSV and life ins at around age 85. At age 75 will look at health and make a decision to keep or cash in no mtg, age 72 this week
Posted By: BJD78

Re: Do you carry Life Insurance? - 06/06/18 11:45 AM

Am age 58 and have a term policy for 450K in 2 year the term will expire. At age 60 term will likely be much more expensive, I will probably just get a 50 or 100K 10 year term and call it good. Only have about 2 years left on house and plan to sell it when we are both 62 and move into elderly retirement apartments. Once house is paid ,no matter which one of us passes first the only bill would be utilities and rent for apartment or townhome. Plan to be a 1 car household then as well, probably keep the Sonata sell the Tuscon and our college age daughter will get the Forester. Another option would be burial insurance which just coverers funeral expense. That is hat my parents both ahd and it covered the funerals and burial costs with no issues.
Posted By: ARCOgraphite

Re: Do you carry Life Insurance? - 06/06/18 01:57 PM

Originally Posted By: alarmguy
Originally Posted By: cashmoney
Absolutely no need for life insurance as you age and kids are gone assuming you have built a reasonable retirement fund and have the house paid off.


^^That^^

As long as your debt free, paid for home and your spouse either works or you have a reasonable retirement account, why give your money to an insurance company?

Results vary depending on your age.


You cant pay off Property taxes. They are more than my mortgage.
As long as the property has equity and doesn't have to be your "final" home it doesn't need to be paid off.
If you invested 300K a few years ago in equities you'd be in 7 figures. But that retirement padding "gift" wont be around again for quite a while.
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