20- 30 yr Life Insurance question (term)

We are FINALLY getting our life insurance together. We are having a hard time deciding on 20 or 30 yrs though. The 30 yr ins is $200 more a year so it's not too bad. The biggest question is we will be in our mid 50's if we get 20 yr and mid 60's if we get 30 year. We will still need to get life insurance when this one expires so we are trying to decide if it will be way more expensive in our 60's (compared to 50's) or it doesn't really matter. I know a lot of things go into it like if by then we have any sicknesses or anything but just trying to figure out what to do.

I see so many people have only 20yrs and was wondering if there was a reason for that .

Any info would be of great help!!

Re: 20- 30 yr Life Insurance question (term)

just as an FYI--remember that once that term is over---the insurance rate will SKY ROCKET.

to be fairly blunt--term life insurance is really not designed to really pay out and help the client---i'm sure if you check out the info from an agent--they will tell you that less than 10% of all term life policies EVER pay out--and instead are usually cancelled after the term is up and you go to renew. since it is not a whole life policy--the premiums you pay don't go into the policy and help it grow--instead all the premiums you paid for 20 or 30 years are lost if you decide not to renew your term policy. (which is what usually happens)

i would have some term insurance----BUT i would also question your agent about whole life policies as well to combine with term.

Message edited 1/25/2008 2:45:03 PM.

Re: 20- 30 yr Life Insurance question (term)

Try a min Universal Life pol that even after the term, will still give you some life ins to continue.
Get the UL now...so it saves age/health and it endows at age 100.
It will be the same rate for the rest of your life and still be a little something after the term is up. Builds cash value and is like whole life but not as pricey.

30 yr is a way to go though.

Message edited 1/25/2008 2:54:43 PM.

Re: 20- 30 yr Life Insurance question (term)

ok, here's what we did. We took out 10 year policies now to pay the lower premium for a few years, knowing that before we're 40, we'll upgrade and get new 20 year policies.

This was actually recommended by the agent - that we extend the policies AFTER we're done having kids (and before we're 40), so the youngest is covered until he/she is 20 years old. I figure by the time we're 60, the kids will be on their own, and we'll have enough assets/equity to not need life insurance any longer.

(Al also has a whole life policy)

Message edited 1/25/2008 3:09:12 PM.

Re: 20- 30 yr Life Insurance question (term)

We took 30 year term, it was more important to us to be covered for the longest period of time since we weren't taking whole (whole accrues a cash value).

Re: 20- 30 yr Life Insurance question (term)

We are definately getting term (although Deb I will try to find out more about Universal). I've been told numerous times to get term as opposed to whole b/c of the high cost and we are better off investing our money elsewhere.

I like the idea of the 10 year until 40 but that won't work for us because I'm only 2 1/2 years away from 40 . That's why we were thinking 30 yr which will bring me to almost 68......but over the course of time it is a lot more money and like others have said, most likely it won't need to be paid out. BUT you NEVER know, I've seen way to many people go before their time lately and it's nice to have the security.

That's why we were thinking 30yr because after that age, we won't need nearly as much...kids will be way gone, house will be paid. Do people even get life insurance at that age .

I just see wo many people with 20yr policies and wasn't sure why and if that would be better than 30...

Message edited 1/25/2008 3:15:54 PM.

Re: 20- 30 yr Life Insurance question (term)

Is the term policy convertible.

I took a 30 year Term and DH took 20 year Term, his health was not as good so the premium was much higher, but both of our policies can be converted to whole life (the rates are a bit cheaper and it is guaranteed incase either of us have any medical issues arise that might cause us to be declined for insurance)

Re: 20- 30 yr Life Insurance question (term)

My husband has tried to explain this to me sooo many times (we have term) because he wants us to convert it to all whole or at least a combo. All I see is how much $$$$ it is and I say no. Not sure why I have such trouble seeing the benefits of whole..we are 35 so I feel like with a 20 or 30 year term we should be ok...as an early poster stated.

Message edited 1/25/2008 4:32:11 PM.

Re: 20- 30 yr Life Insurance question (term)

Posted by betty

We are definately getting term (although Deb I will try to find out more about Universal). I've been told numerous times to get term as opposed to whole b/c of the high cost and we are better off investing our money elsewhere.

I like the idea of the 10 year until 40 but that won't work for us because I'm only 2 1/2 years away from 40 . That's why we were thinking 30 yr which will bring me to almost 68......but over the course of time it is a lot more money and like others have said, most likely it won't need to be paid out. BUT you NEVER know, I've seen way to many people go before their time lately and it's nice to have the security.

That's why we were thinking 30yr because after that age, we won't need nearly as much...kids will be way gone, house will be paid. Do people even get life insurance at that age .

I just see wo many people with 20yr policies and wasn't sure why and if that would be better than 30...

Re: 20- 30 yr Life Insurance question (term)

Posted by betty

We are definately getting term (although Deb I will try to find out more about Universal). I've been told numerous times to get term as opposed to whole b/c of the high cost and we are better off investing our money elsewhere.


That's why we were thinking 30yr because after that age, we won't need nearly as much...kids will be way gone, house will be paid. Do people even get life insurance at that age .

I just see wo many people with 20yr policies and wasn't sure why and if that would be better than 30...

Re: 20- 30 yr Life Insurance question (term)

I would go with the longer term.

Also, as you get older the need for insurance is still there. You may have incurred debt and there's always a need for money to bury your spouse if the spouse is still alive.

If you have saved and provided enough for your retirement then the insurance is not as important.

I wish my parents had more insurance. They don't have a lot of assets and dad only has a $50k policy. He converted that from an old job.

We both have term. We have the option to convert to whole in year 20.

What we may do is get a new longer policy as time goes on. We have to see what are needs are down the road.

Re: 20- 30 yr Life Insurance question (term)

You're making the assumption that when your term policy expires your health would still be good and you would be eligible for more insurance which is a risky gamble. There are many health issues that could keep you from qualifying, such as cancer, heart attack, severe diabetes, etc.

As was mentioned, term is often used for declining needs, such as covering a mortgage and other debts, supporting young children, etc. Some whole life can be useful for burial expenses, estate taxes, etc.

If you look at Universal or Variables read the small print VERY carefully - they invest the assets and often make inflated assumptions on returns. DH deals with customers all the time that got screwed with Universal or Variables that were underfunded and are worthless so make sure you really trust the agent and understand what you're getting if you go that route.

Re: 20- 30 yr Life Insurance question (term)

man we have some smart ladies here! I had no idea about any of this. I feel very about the whole thing. Ladies who seem to know what they are talking about.
Now that I beat cancer will I be able to get better insurance? I was young and didn't really think I would need any (stupid and young decision) then of course I was sick so was getting denied or it was realllllly pricey and such.
Does the amount of time cancer free figure in? Maybe really costly now but in 3 or 5 or 10 years will come down?
Just wondering if anyone happens to know this off the top of their head and can save me a ton of research.

Re: 20- 30 yr Life Insurance question (term)

Re: 20- 30 yr Life Insurance question (term)

Just recently DH and I switched our term to whole life. DH's premium is $700 mine is about $500/year which I dont think is too bad. I feel much more comfortable having the whole life now as the cost would have been significantly greater if we did it when we were older.

Re: 20- 30 yr Life Insurance question (term)

Posted by DebG

man we have some smart ladies here! I had no idea about any of this. I feel very about the whole thing. Ladies who seem to know what they are talking about.
Now that I beat cancer will I be able to get better insurance? I was young and didn't really think I would need any (stupid and young decision) then of course I was sick so was getting denied or it was realllllly pricey and such.
Does the amount of time cancer free figure in? Maybe really costly now but in 3 or 5 or 10 years will come down?
Just wondering if anyone happens to know this off the top of their head and can save me a ton of research.

Re: 20- 30 yr Life Insurance question (term)

Remember that whole life and term life are really for two different things.

We bought term life because it is much much cheaper than whole life insurance. The difference between the costs between the two types of policies will be invested how we see fit, rather than how the insurance company sees fit. The term life is a worst case senario type of deal...you know, just in case between now and 30 years.

The thinking is that we can get a better return than we would through a whole life policy and that is what we will be able to leave behind for the beneficiaries. Whole life insurance policies are usually very expensive, especially given the rate of return.

I would suggest doing some research on the pros and cons to see what type is right for you. There's a lot of information out there about the advantages and pitfalls of each type of insurance.

Re: 20- 30 yr Life Insurance question (term)

Re: 20- 30 yr Life Insurance question (term)

My DH and I both have a 20 yr term... our goal was to cover our mortgage and any debt, college or anything like that if something would happen to one of us while our kids are young.