fellersbarnoneranch
Well-known member
rwtherefords":3ava7sp6 said:
That sounds like a million dollar quote!
Whole or Term?
- Thread starter certherfbeef
- Start date
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That sounds like a million dollar quote!
jennibluis
Active member
denoginnizer":18ww7xxf said:
Gauranteed.
For example, (using made up numbers):
A million dollar policy plus accumulated cash value.
If I die today my son (well, his guardian until he's 18 or 21) gets a million dollars plus a little cash value.
If I die in 25 years my son gets close to 2 million.
If my son goes to college in 10 years, it's not considered an asset on those lovely financial aid forms, but can be borrowed.
If I get a terminal illness, I get the money.
If I outlive my policy,(your only allowed to pay into up to a certain point per policy) I get a close to a million dollars in retirement money.
If I need to buy a new truck for the farm as a business expense, I can deduct the interest rate of x+2% on my taxes. But it really only cost me 2% because x% is the rate they pay me.
norriscathy
Well-known member
jennibluis":1g27kesp said:
All you are doing is repeating the sales pitch of you insurance agent! Rwtherfords is absolutely correct. I've been doing this kind of analysis for 30 years now. DO THE MATH; or get someone to help you. Any bank would be happy to loan you the amount on your CD plus 2%. That is no big deal, just normal banking. A 60 year old can now purchase $100,000 5 year level term policy for $75 per month; a 30 year old is something like $25 per month. What are you paying? DO THE MATH!!!!!!! You'd probably be better off buying term and putting the premium difference in a cookie jar!
jennibluis
Active member
It still earns almost 2x's more than a cd while your "borrowing" the money. It cost 2% for the loan, not cd plus 2%.
Plus:
Maybe your kids are already in and out of college, but mine isn't. Financial aid is based on ALL your assets, not just liquid assets.
Life insurance isn't counted and the amounts added are not looked at.
Plus:
Maybe your kids are already in and out of college, but mine isn't. Financial aid is based on ALL your assets, not just liquid assets.
Life insurance isn't counted and the amounts added are not looked at.
norriscathy
Well-known member
Read denoginnizer again Its x+2% where x=the amount of interest they are paying him. Don't know what a 2% "margin" is. Doesn't sound the same as 2% interest. Better go back and read your policy.
jennibluis
Active member
My policy pays a minimum of 6%. Loan cost would be 6%+2%=8%
If they raised the rate to 10% earnings loan cost would be 10%+2%=12%, that's what I meant by margin.
If they raised the rate to 10% earnings loan cost would be 10%+2%=12%, that's what I meant by margin.
OP
OP
certherfbeef
Well-known member
Thanks for all the replies. Bez has offered some information and as soon as I get some info to him he's graciously going to answer some questions for me.
But for the rest of ya...I'm 28 hubby is 34 our oldest rugrat is 6. If I was to buy term life insurance, do I buy 10 years at a time? assuming that as I age I have fewer bills.
But for the rest of ya...I'm 28 hubby is 34 our oldest rugrat is 6. If I was to buy term life insurance, do I buy 10 years at a time? assuming that as I age I have fewer bills.
norriscathy
Well-known member
jennibluis":a9d6xkf1 said:
Like I said before; no great deal! They are charging you 2% to use your own money! DO THE MATH! Find a good CPA and let them help you out. A couple of hundred dollars in fees will save you many fold that in unecessary premiuns OR put your mind at ease. DO NOT go to a "financial planner" / insurance agent. They probably sold you the policy in the first place and like all salesmen they don't earn anything unless they sell you something.
PS:
There are tons of knowledgable people on this board. Ever wondered why no one has jumped on my head????
Ryder
Well-known member
A little off the subject, but I had occasion to get involved with an annuity salesman some time back. I caught him lying like a rug.
I had gone to a good bookstore and did my on studying. Did not let him do it for me.
I had gone to a good bookstore and did my on studying. Did not let him do it for me.
rwtherefords
Well-known member
certherfbeef":ux9kqnm6 said:
Since the rates for term insurance goes up as you age, I suggest that you evaluate your expected financial situation at 10, 15 & 20 year intervals. Then determine what to buy.
For instance, in 10 years your son will be 16, & your husband 44. Does your son still have college in front of him? Do you rent or own? If you own, how much equity will you have in the place in 10 years? Add all equity & assets, then subtract all debt/liabilities. The figure you have left is your projected net worth. Assuming that you son is your sole heir/beneficiary, will that amount get him started in life as you wish. If not, you'll still need life insurance for some amount in 10 years. I know you said that your oldest rugrat was 6, so the needs of the additional children must be taken into account. If you expect to still need life insurance in 10 years, you need to evaluate if it's beneficial to purchase it now at a lower rate. It's possible that you'll need much less insurance in 10 years, and that purchasing less insurance will be cheaper in 10 years even if it's at a higher rate. The opposite may be true, as well. That's something only you can decide based upon your specific needs.
