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curliegirl
He's here!!!!
Member since 3/06 10128 total posts
Name:
Gina
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Whole life insurance vs. Term
I'm being told (and it seems to make some sense) that whole life insurance isn't always a good "investment"
The way I tried to explain it to DH is if we were to spend $500/month EACH on whole life, the $$ we would receive in the end would be far less than taking that same $$ and investing it more wisely (not that I know what that necessarily is)
Am I missing something?
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Posted 7/16/08 10:59 AM  |
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Long Island Weddings
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Candy Girl
Candy girl- you are so sweet!
Member since 11/07 6349 total posts
Name:
erin
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Re: Whole life insurance vs. Term
I'm no expert, but I think most financial experts encourage term over whole life insurance. Whole is MUCH more costly and when you think about it, life insurance should just be-well, insurance--in case the very worst happens. I think it should cover the cost of the mortgage in full and some cushioning. But again, I am no expert.
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| Posted 7/16/08 11:04 AM |
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curliegirl
He's here!!!!
Member since 3/06 10128 total posts
Name:
Gina
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Re: Whole life insurance vs. Term
Posted by Snickers
I'm no expert, but I think most financial experts encourage term over whole life insurance. Whole is MUCH more costly and when you think about it, life insurance should just be-well, insurance--in case the very worst happens. I think it should cover the cost of the mortgage in full and some cushioning. But again, I am no expert.
WHich is why we just started a 10 year policy to get us going and next year we will rearrange it to a 20 or 30......
Thaks!
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| Posted 7/16/08 11:05 AM |
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KartveliT
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Member since 1/08 8363 total posts
Name:
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Re: Whole life insurance vs. Term
We got term life.
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| Posted 7/16/08 11:08 AM |
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Beth
The Key to your new home....
Member since 2/06 24849 total posts
Name:
Beth
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Re: Whole life insurance vs. Term
in total money make over- David Ramensy recommends a term life polcy
it's way cheaper
and when it runs out- the goal is that you no longer NEED life insurace and can be "self" insured
We were going to spend an insane amount of money on life insurace every month- and I am glad we just decided to get term
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| Posted 7/16/08 11:08 AM |
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ILJ619
LIF Adult
Member since 6/06 1985 total posts
Name:
Irene
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Re: Whole life insurance vs. Term
Most financial advisors say term. Whole is sort of multi tasking something you can do yourself. 
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| Posted 7/16/08 11:24 AM |
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Smileyd17
kids
Member since 5/05 20997 total posts
Name:
Mommy
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Re: Whole life insurance vs. Term
Term is a financially better policy that does exactly what it needs to do is protect within that time period and I normally recommend a 30 yr Term. Its a flat prem based on your health and is the same throughout the policy term.
Anything that has a renewal has potentional of being more money, esp renewing at an older age and health can become an issue, so always try to consider a higher term, to lock in the health and age rate.
Message edited 7/16/2008 11:33:34 AM.
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| Posted 7/16/08 11:31 AM |
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curliegirl
He's here!!!!
Member since 3/06 10128 total posts
Name:
Gina
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Re: Whole life insurance vs. Term
Anything that has a renewal has potentional of being more money, esp renewing at an older age and health can become an issue, so always try to consider a higher term, to lock in the health and age rate.
Talk to me about the smoking thing. I told the agen that we had recently quit (little white lie) and he said we have to be insured now as smokers and next year we can cancel the 10 year we have and get a new 20 or 30 at a lower rate because it takes a year to be considered a non-smoker...
Is this true?
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| Posted 7/16/08 11:41 AM |
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KartveliT
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Member since 1/08 8363 total posts
Name:
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Re: Whole life insurance vs. Term
Yes that is true, that's why when smokers apply for a life ins, they lie and say they never smoked . Rates are always much higher for smokers / former smokers.
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| Posted 7/16/08 11:51 AM |
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emeraldeyez
LIF Infant
Member since 10/07 351 total posts
Name:
mommy
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Re: Whole life insurance vs. Term
sorry to hijack but I'm buying a house and thinking of getting a 30 year term insurance policy for DH and myself. generally speaking, how much does it cost a month?
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| Posted 7/16/08 11:55 AM |
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fins
LIF Adolescent
Member since 9/07 821 total posts
Name:
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Re: Whole life insurance vs. Term
Posted by dediko
Yes that is true, that's why when smokers apply for a life ins, they lie and say they never smoked . Rates are always much higher for smokers / former smokers.
I believe when you have your blood work done the tobacco will show up.
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| Posted 7/16/08 11:57 AM |
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Smileyd17
kids
Member since 5/05 20997 total posts
Name:
Mommy
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Re: Whole life insurance vs. Term
Posted by curliegirl
Talk to me about the smoking thing. I told the agen that we had recently quit (little white lie) and he said we have to be insured now as smokers and next year we can cancel the 10 year we have and get a new 20 or 30 at a lower rate because it takes a year to be considered a non-smoker...
Is this true?
Yes
Anyone that is a smoker or hasnt smoked within a yr, is rated as a smoker rate.
You are able to get retested after a yr of not smoking and have the potential of a preferred or super preferred rate.
You can do a 20/30 yr and still do the same, get retested and still be offered a good rate that will last the term of policy without having to cancel.
Seek your options and rates.
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| Posted 7/16/08 12:01 PM |
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curliegirl
He's here!!!!
Member since 3/06 10128 total posts
Name:
Gina
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Re: Whole life insurance vs. Term
Posted by emeraldeyez
sorry to hijack but I'm buying a house and thinking of getting a 30 year term insurance policy for DH and myself. generally speaking, how much does it cost a month?
For us it was
Me-29, smoker-30 years-$92.75/month
DH-37, smoker, 30 years-$183.60
This was for $500,000 through WIlliam Penn
We got the quotes through Select Quote and they sent us a bunch of different rate comparisons. It was pretty easy.
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| Posted 7/16/08 2:17 PM |
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pinkandblue
Our family is complete, maybe
Member since 9/05 32436 total posts
Name:
Stephanie
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Re: Whole life insurance vs. Term
Posted by emeraldeyez
sorry to hijack but I'm buying a house and thinking of getting a 30 year term insurance policy for DH and myself. generally speaking, how much does it cost a month?
DH and I both have 500k policies, mine is 53 a month, dh's is 91 (he is a smoker) 
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| Posted 7/16/08 2:38 PM |
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ali120206
2 Boys
Member since 7/06 17792 total posts
Name:
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Re: Whole life insurance vs. Term
We went with term through SelectQuote as well. We had someone come from Allstate to our home and SelectQuote had much better rates (through William Penn).
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| Posted 7/16/08 2:51 PM |
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KLSbear
LIF Adult
Member since 1/06 1908 total posts
Name:
Karen
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Re: Whole life insurance vs. Term
Posted by curliegirl
I'm being told (and it seems to make some sense) that whole life insurance isn't always a good "investment"
The way I tried to explain it to DH is if we were to spend $500/month EACH on whole life, the $$ we would receive in the end would be far less than taking that same $$ and investing it more wisely (not that I know what that necessarily is)
Am I missing something?
Something like 90% of all term life policies never pay out. Sort of like paying homeowner's insurance for years - you pay it (and hopefully never need it) but don't get anything back in the end. Whole Life has a guaranteed pay out (when you pass on) and also accumulates a cash value that you have the option to take if you decide to cash out the policy before your death. But a Whole Life policy should never be considered an investment - it's insurance to cover something with guaranteed pay out. They have their appropriate place in estate planning, just as term policies do.
Whenever a financial planner advises you purchase a particular type of financial instrument it's a good idea to consider what they do for a living. Certified Financial Planner is a certification, not a profession. It's held by stock brokers, insurance professionals, accountants, etc. Very often, the reason you'll see a CFP recommending Term Insurance (especially if they are telling you to cash in a well establishe whole life policy) it's because they want to free up your cash to purchase their stocks, mutual funds, etc. so you need to look at the full reasoning behind their recommendations.
One way to look at it is to have Term to cover expiring debt (car and CC loans, mortgage, etc) and some Whole Life to have guaranteed coverage at a set rate. If you're getting Term, make sure it can be converted to Whole Life if you decide later you want to do so. Health can change and you want to be certain you have access to some type of insurance.
Needs based assessments look at what expenses you want the insurance to replace if the person covered should die. Do you need to pay off the mortgage, provide day-to-day income for your family (income replacement), replace services they provide (does a widowed husband need a nanny, housekeeper, or does a widowed wife need lawncare, health insurance no longer covered by a husband's job, etc.)? Think about how the surviving spouse and children would manage if one or the other income (or both) were gone - that's what you need to plan for with regards to replacing that money through insurance, savings, etc.
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| Posted 7/16/08 6:15 PM |
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juanvi
Get Out!
Member since 10/06 4463 total posts
Name:
Christina
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Re: Whole life insurance vs. Term
i've heard term
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| Posted 7/16/08 6:19 PM |
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MikesWife
Wanting...........
Member since 1/06 6887 total posts
Name:
Karen
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Re: Whole life insurance vs. Term
DH and I went with whole life insurance. I wanted to be locked in for life at a premium of a healthy 28 year old.
We went with Northwestern Mutual.
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| Posted 7/16/08 6:29 PM |
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