Posted: 17 Feb 2011 04:17 Post Subject:
Term life is typically cheaper and used to cover shorter term coverage needs like the mortgage on a house and credit card bills and so forth. Whole life is more expensive but last forever ( as long as you pay premiums ) and can accumulate cash value which can be withdrawn later in life. Think of it like owning VS. renting
Posted: 05 Aug 2011 12:20 Post Subject:
As Dave Ramsey says, buy term and invest the difference. Term is cheaper at face value, but not if you invest the difference. You will have life insurance, but you will use the left over money to invest and actually make more money. But the key is investing the difference. Dont just spend it.
Link removed - Admin
Posted: 05 Aug 2011 01:09 Post Subject:
True, one should do a careful research before investing this difference. There are a lot of options coming up everywhere.
Posted: 07 Aug 2011 02:36 Post Subject:
Term is cheaper at face value, but not if you invest the difference.
This statement makes no sense.
Insurance and savings are two different things. The insurance does not cost more because you save "the difference" between a term policy and an equal amount of whole life insurance. You are simply redistributing the same amount of money from your cash flow. Term life insurance is less expensive than cash value insurance at the time it is first issued. It will not be the same forever.
The main difference is that with term life and separate savings, a beneficiary would receive both the insurance proceeds and the present value of the separate savings. In whole life insurance, the "savings" portion is part of, not separate from, the death benefit. In universal life insurance it is possible for the beneficiary to receive both the death benefit proceeds AND the cash accumulation component, making it somewhat like "buy term and invest the difference." However, life insurance is not an investment. It is life insurance.
you will use the left over money to invest and actually make more money.
No one can guarantee this unless you put the money into a fixed income vehicle. And it may or may not be a tax-deferred vehicle, which could result in diminished savings over time if it is not a tax-deferred vehicle. You could put the "left over" money into stocks or mutual funds, real estate or junk bonds, and lose some or all of it. Then where will you be?
"Buy term and invest the difference" is a general principle that can work to a person's advantage. As you said, it only works if the person actually saves the money. Not everyone has that self-discipline. For those who don't, a whole life policy may be a better solution.
Then, again, term life insurance is not appropriate in all situations. The increasing cost at renewal can cause a person to give up their life insurance when they really need it the most. This would not happen with a whole life policy, despite the fact that it was more expensive initially.
A good agent will explore all facets of a person's need for insurance and their long term objectives. They cannot make "blanket" prescriptions based on Dave Ramsey's or Suze Orman's or Charles Givens' rantings or writings concerning term and whole life insurance alone. With complete understanding of a person's needs, the right insurance products and savings plans will become apparent. There is no "one size fits all" kind of life insurance.
Term life is not better than cash value life insurance, it is simply a different product that meets specific needs. Cash value life insurance is not better than term insurance, it is simply a different product that meets specific needs. The whole point is: your specific needs will determine the proper product for your current situation. As your situation changes, your need for insurance may also change.
Almost all Primerica agents will only recommend "buy term and invest the difference" because they don't have cash value products to offer. If term is not the appropriate solution for their client, the client will probably still end up with a term policy, instead of the Primerica agent telling them, "What you need is a whole life policy, and I can't help you with that." There are only a few Primerica agents who actually understand that and do the right thing when the time comes.
Posted: 08 Aug 2011 09:36 Post Subject:
The following is strictly my personal opinion and should not be confused with anything I have testified to, written about or participated in.
I have been investigating Life Insurance Fraud in the United States for a little more than 18 years and according to some (not including my Mother) am one of the very best at determining which companies are good and which are - not the very best.
Like some of those "consumed" with the Amway theory, you may have fallen prey to one of the most well-known pyramid schemes in history. Don't feel bad; thousands of people have been convinced they can go to work for Primerica, help people, and that God himself will somehow look favorably on what they are doing to the American insurance marketplace.
Very much like the Amway of old, Primerica will hire someone to sell insurance in their spare time, convince them to sell something to everyone they know, then encourage them to hire all their friends and family to sell insurance part time. Isn't everybody brought into the Primerica arena by a friend or family member who swears they are the very best thing since sliced bread?
The problem is, if you remain in the business long enough to "figure things out," you'll wind up going to work for a real insurance company and Primerica would have made tons of money off of you. MCI's Friends and Family probably took lessons from these guys.
I quite frequently run across Primerica cases which have been referred to me by agents who are looking for some influence from a reputable "third party." Quite often I'll meet with a young family in my office who has been convinced they need $400,000 worth of term insurance coverage. These are usually young couples - in their 20s with a new baby, renting an apartment, driving a 74 Ford Pinto with not a hope of having any sort of estate problem in the next century or two.
Because term commissions are not very high, some Primerica agent has brainwashed them into purchasing a huge policy, which by all industry standards, they haven't the need for.
And the "Theory of Decreasing Responsibility" in my opinion, is the biggest bunch of horse manure I've ever run across. As I get older, I'm going to get nicer toys and live a better life. Once my children are out of college and taken care of, my wife and I plan on buying a big house on 40 acres and I'm going to put in my very own airstrip so I can fly my airplane to see my grandkids. We may have an RV, a larger boat and a "tricked-out" golf cart.
Live extremely well and die with just enough to bury you -that's my theory of decreasing responsibility. You may find it odd that most of the Forbes' CEOs agree with me.
The "buy term and invest the difference" theory was invented years ago by a man named A.L. Williams. Mr. Williams or "The Coach” was consumed by the idea that all Americans should own life insurance policies - his life insurance policies, and that each and every one of the more than 400 insurance companies doing business in the U.S. did business the wrong way. His practices were to slander the "cash value" concept, defame the companies who'd been in business for hundreds of years and convince everyone that they should "wet on Met and/or screw Pru". In his mind, he was some sort of "savior" sent by the insurance gods on high to right that which was wrong, help people and make an incredible amount of money in doing so.
To make a very long story short, Mr. Williams got in a great deal of trouble and was - for all intents and purposes - "run outa town" by the Federal judicial system and those who saw through his smoke and mirrors scheme.
There are bus-loads of Primerica agents who will dispute my opinions and swear that I have been influenced by the corrupt cash value industry. ME!! – the guy who has blown the whistle on this very industry and whose work has led to well over $1.25 billion (with a B) in lawsuits against Met, Pru, NY Life, John Hancock and dozens of others.
I'm going to jump down off my soapbox and give you the opinion you asked for. If I were in your shoes, I WOULD STAY AS FAR AWAY FROM PRIMERICA AS HUMANLY POSSIBLE.
If you want to sell life insurance products, there is nothing wrong with the cash value concept (except that too many agents abuse it.) Primerica's term insurance is among the most expensive in the industry and their investment products often have huge internal costs or loads. Primerica is often referred to as the
"Amway of the insurance industry" and its followers are most generally looked down upon.
If you are/were trained to believe in the A.L. Williams theory, my words will offend you and I will certainly lose all credibility you may or may not have had for me. I realize that if I were standing at the front of the line telling the people in Jim Jones' cult not to drink the purple Kool-Aid there are few who would have listened to me. If I had been in Waco, Texas a few years ago, the Branch Dividian would have still been "nuked" and many people would still have died needlessly. Every society has the "leaders" and the "followers" it's up to you
to figure out which way you want to go.
It is not all that difficult to be an honest insurance agent and to help people. As an agent, had a place in the top 2% of all life insurance agents and I never wrote a policy I was afraid would come back to bite me in the future. There are good companies out there and great people working for them.
I hope you have gained a little insight from my ravings. If you want to challenge my point, go into your local yellow pages and call a few agents and ask them what they think of Primerica. You'll soon find that I am not alone.
Good luck in the future. If you'll tell me where you live, I may be able look into my data base and find other companies or agents who will be glad to pull you away from "the dark side".
Posted: 27 Aug 2011 02:11 Post Subject:
Mark, excellent post.
Posted: 28 Nov 2011 05:18 Post Subject: Life insurance
If your mom is over 50, You might want to consider term life insurance for senior since it will provide a lot of benefits for your mom in the next few years. Term life insurance costs cheaper than whole life insurance. If your mom purchases term life insurance, she only has to pay premiums for certain period that she expected to live.
Here is a very useful site that you might want to check out. a lot of information is included :
[Link removed by Moderator MaxHerr per TOU]
Posted: 05 Jul 2012 12:06 Post Subject:
Term Insurance covers only a period time may 5 to 20 years, after which you may have to renewal it if needed. If term insurance is renewed, the less premium is about to increase. The Beneficiary can claim the insurer when the event of death of policy holder happens only in the insured period.
Whole Life Insurance is for the entire life. No renewal of the insurance is needed. Policy holder has to pay the premium for the entire life until the event of death occurs. Premium is the same for entire life. There is no increase in the premium amount but high compared to term insurance. The beneficiary is paid the lump sum amount on the event of death of the policy holder.
When comparing total amount of premium paid for short period, term insurance would be less whereas whole life insurance would be high.
For Long period, whole life insurance premium amount will be less and term insurance premium is more as it increases once renewed.
If want to know more on the difference please check this
[Links removed per TOU]
Posted: 22 Feb 2013 10:29 Post Subject:
Both are good well let me explain the both plans. May this help you two find the right policy? In simple word Term life insurance is one of the best plan provide by insurance companies In this plan we will get death benefit, surviving Benefits etc and talking about whole life insurance that provides us coverage for the lifetime also there is bounce, tax benefits etc.
Posted: 23 Feb 2013 04:01 Post Subject:
Term life insurance is one of the best plan provide by insurance companiesTerm life insurance is neither good nor bad. As a result it is not possible to say it is the "best plan" (or even one of the best).
Each situation is unique, and, in the long run, term life insurance could be THE WORST decision a person could make about the type of life insurance to purchase today.
Work with an experienced local agent who will interview you and understand your situation and both your immediate and long-term needs, and who will make the appropriate recommendations for you and explain why he/she believes that to be the case. It could be term, whole life, one of several forms of fixed universal life, or a variable policy. It could even be a combination of two or more of them in some cases.
And the very best agent might have to say to you, "What you need, I can't help you with today." Sometimes good agents who should say those words to you don't. Instead, they sell you something else today so they can be paid a commission. That's unfortunate.
There is no ONE RIGHT ANSWER to the question "Should I get term or cash value life insurance." Even Primerica agents, who only market term life insurance, sometimes get this wrong, too, and they won't say, "What you need is . . . ."