Re: Suggestions for life insurance?
I agree with Ima!
Cancel the whole life ripoff insurance and replace it with term insurance. Be sure to get the term insurance first before cancelling and cashing out the whole life policy. Invest the difference in a nice no-load (or low-load) mutual fund and you will be much further ahead in the long run.
Generally speaking, if you purchase a 20 year term policy (much higher death benefit like 250,000-500,000) and invest the difference from your whole life premiums minus the term premiums you will be basically self insured in 20 years. The idea is that in 20 years most will be done raising their kids, mortgage should be paid off (15 yr mortgage recommended), and the need for life insurance should be minimal at best.
The $1800 could payoff 100 months of a $18 per month term policy. At age 28 and healthy he should be able to get $400,000 20 year term policy.
$18 * 12 months = $216/yr
Buy a 5.5% 1 yr CD with the $1800 cashout and earn $99 interest per year...add $117 of your own money and invest the $300-$117=$183 and into a Roth IRA and you will kill the cash value of that whole life policy! Or put the whole $1800 into a Roth IRA and pay the whole $216 out of pocket.
Good luck!
Invest the $84 per year difference and you will have more cash value than that lousy whole life policy.
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