by Guest » Fri Dec 05, 2008 10:46 am
Hi,
Can I really think of life insurance as a commendable investment option? How do I judge whether its right for me to think of it that way?
brown_brooke
Can I really think of life insurance as a commendable investment option? How do I judge whether its right for me to think of it that way?
brown_brooke
Posted: Sun Dec 07, 2008 10:36 pm Post Subject:
me too that's all i wanted as well...
just something to take care of the final
arrangements (God forbid).
.
Posted: Sun Dec 07, 2008 11:13 pm Post Subject: insurance
I know what you mean about "God Forbid"..........however, you just never know.
Posted: Mon Dec 08, 2008 04:28 am Post Subject:
There's another thing that you have to consider when insuring a child. Many of you have mentioned coverage in the event your child should die. While the premise is sound, the likelihood of your child dying in early life is slim. Frankly, that's not the primary reason you should consider buying coverage on a kid.
The main reason you buy life insurance on you kid is to protect their insurability. Typically, you're never healthier that when you're a child, and the premiums are never cheaper than when you're young when talking about life insurance. So, the reality is that while the kid is healthy now, buy the coverage and lock in their insurability so that if their health changes down the road, it won't be a factor. An insurer is not allowed to cancel or rerate a policy once issued and past the contestability period except for nonpayment of premiums.
For all three of my kids, we have purchased what are known as "jumping juvenile" contracts. They start off with a face amount of $50,000 on each kid, and when they turn 21, the face amount "jumps" to $250,000 without evidence of insurability and there's no premium change. That's a quarter milion dollars of coverage that cannot be taken away, and the premium is based on the kids' age at purchase. That'll be a hell of a deal when they're 40 years old with kids. And they have a cash value component, which adds to their value. Again, not at all an investment, just a fund from which they can withdraw from or borrow against if they have to.
Thanks to the powers that be that all the kids are healthy, and I hope I'll never see those policies used. They were bought for my kids and their families, not me and their mom.
InsTeacher 8)
InsTeacher
Posted: Mon Dec 08, 2008 05:06 am Post Subject:
WOW!! JEORGE....why is buying a Life Insurance policy, for a child, so bad? I thought it would cover Funeral Expenses, building 'cash value', etc. (God Forbid..)
Hey SD, there is nothing wrong in purchasing life policy on a child, but its more often a sentimental decision than an informed financial decision. I don't support purchasing life plan on a kid purely on the basis of principal. I don't think that the parents want to be benefited out of their child's death rather they'd take care to secure that the child doesn't become destitute upon their death.
Posted: Mon Dec 08, 2008 11:45 am Post Subject:
The main reason you buy life insurance on you kid is to protect their insurability
I forgot to mention that thank you teacher for doing so...the little policys we bought for the grandbabies, also if the kids (by then adults) convert them they are guaranteed insureable..at the same rate....something to think about as an example should a kid come down with lets say juv. diabetes...what is the rate (percentage wise) increase compared to a healthy child/adult?Jeorge as I've said over and over, the reason 'we' personally did this was for the financial burden that it would cause us to make and pay for these arrangements, and also since they were unused (Thank you Lord) now they would benefit their families after the bills are paid...I can't imagine ANYONE wanting to benefit financially from the death of a child...and really Jeorge, if you are not born with a silver spoon in your mouth...when you have a young family (we these policys on the kids were bought) and live check to check did you have 10k setting around to handle this? If so good for you but most don't.
Posted: Fri Dec 12, 2008 12:57 pm Post Subject:
Can anyone tell Does the government has any contribution over this, as it is a matter of assurance, or any plans that have special recognition from goverment, besides benefits?If yes,how?
Posted: Thu Jan 01, 2009 08:05 pm Post Subject:
SD,
If you are looking for a cash value policy for your son, this is what I would do.
First, determine how much you can commit to put away on a monthly or annual basis.
Then, I would buy the minimum non-mec death benefit on an indexed UL or Variable UL. That's it.
Lincoln Financial Group, MetLife, ING and John Hancock are some good VUL companies. For indexed UL I would look at AVIVA.
Posted: Thu Jan 01, 2009 08:11 pm Post Subject:
brown_brooke
If you need both the insurance and the investment, sometimes there are tax advantages to keeping them together, especially if you have already maxed out your other tax deferred vehicles.
If you do not need the insurance, then it is alot harder to make the argument for life insurance as an investment without getting extremely creative.
Some companies loan premiums to their employees so they can buy cash value variable universal life policies and use them as retirement plans. What happens is the employees can take tax free loans from the policy when they retire. When they die, the death benefit pays off the loan to the employer
Posted: Fri Jan 02, 2009 03:00 am Post Subject: insurance
I thank for the recommendation, VICTOR. Sometimes all of the choices can be a bit overwhelmong and confusing. Thanks, again.
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