Cashing out whole life policy or loan?

[drbdigitizing]

I'm new here, seems like a great forum. Looking for some free advice. I have a whole life policy which I know is not the best idea but over the years it has forced me to save a lot more money than I would have without it. And I'm pretty sure the answers here will be a resounding cash out but I just want to confirm. Well some life situations made us go from debt free a few years ago to $40K in credit card debt. Those situations are gone and I've been able to pay down some debt but it will take years and cost thousands in 10% interest which I would like to avoid. I know it's a bad idea to touch IRA's so I'm leaving those. Probably not enough equity in our home to refi but it's close could be a possibility. I looked into details of my whole life policy and I can cash it out for over $80K and a profit of $5K which isn't too bad considering the payments were also going to a term policy as well. Of course they're trying to talk me into a loan. I just can't see paying interest on $40K for all those years(7.5% interest). If I take the loan I still have to pay $4500 a year in premiums and try to pay at least $300 a month towards the loan. I think I should cash out, pay the debt, invest the excess cash somewhere we can keep in reserve for emergencies and start putting those premium payments towards bigger payments to our IRA accounts. And then get a term policy for $500K.

[drbdigitizing]

Thanks for the response! I think I'm on the right track.

[Petunia 100]

Thanks for the response! I think I'm on the right track.

I think you are, too.

[elfen lied]

I too think that life insurance is very useful … help the next generation for the costs of education also