Life Insurance

[CurlyDave]

While I worked for a company I had term life and always paid the extra to bring it to 5 times salary.

Didn't ever have any whole life, because I put money into a 401(k). There is no need for a separate policy with a residual value if I have retirement savings, since if I die I don't need any retirement income. DW worked and did the same.

Now that we are retired, we have no life insurance, but our 401(k)s have been converted to IRAs. There is enough there to take care of either of us.

To me, having no mortgages and no money in stocks is a grave financial error, even in retirement. The certainty that money will be eaten away by inflation is a much greater problem than any risk associated with stocks or mortgaged investment property.

 

[MossRoad]

I still don't understand why anyone would want a mortgage? What's the advantage?

 

[randy41]

the op doesn't really have much need for life insurance does he? his wife is a professor so she earns a ton of money.

 

[murphy1244]

I still don't understand why anyone would want a mortgage? What's the advantage?

I don't get it either. Why would I want debt?

 

[smstonypoint]

I still don't understand why anyone would want a mortgage? What's the advantage?

He was referring to using mortgage debt on investment properties to increase the potential returns to his equity.

Steve

 

[blueriver]

I did not read the whole thread ... life insurance to me seems to be on an individual bases ... I have a policy but often wonder is it enough?

I've been known to tell my wife "Why would I need more, heck the new man is going to get everything ... you expect me to pay him to take you!!"

 

[blueriver]

I did not read the whole thread ... life insurance to me seems to be on an individual bases ... I have a policy but often wonder is it enough?

I've been known to tell my wife "Why would I need more, heck the new man is going to get everything ... you expect me to pay him to take you!!"

 

[KennyG]

I still don't understand why anyone would want a mortgage? What's the advantage?

I have a large 15 year mortgage at 3.25%. I am past "normal" retirement age. I can pay off the mortgage at any time but I'm betting that my stock market investments will average considerably more than 3.25% over the 12 years left on the mortgage.

 

[Deere Dude]

So you cut off your nose to spite your face? And then you invested in the stock market and really went backwards? Okey Dokey. You sure showed him about them new cars huh?:laughing:

Just kidding about the stock market. I didn't have much money and the house was paid off or almost paid off. Put a pittance in the stock market and that goes up and down as you know.

I just couldn't see paying for life insurance for 50 years, month after month, when it doesn't cost that much to stick somebody in the ground. Pay in on a term policy for 40 years and get sick of the payments so you quit making them, you die and don't get anything out of it anyway.

Besides, I have a better use for that money in the mean time, like a JD tractor.

With the house and mutual funds and savings accounts plentiful, when I die doesn't it make sense that a funeral and living expenses for the wife for a time could come out of that? Why pay somebody else like an insurance man and his overhead to do what I can do with a little saving?

 

[Handloader109]

This is how they whole life insurance companies scam you! Only buy term, Straight term and nothing else.

Cash value is just a percentage of your invested money, and will disappear into the insurance company's pocket when you die. The face value is what they pay at death. So in npalen case, his face value is 40k, that is all his wife gets if he dies. Not 100k.

 

[npalen]

You,re right! I probably need to look at trading some cash value for increased death benefit.
All this talk of morbidity reminds me of a local citizen who requested that he be buried with a fifth of whiskey within arm's reach.
And then there's the one about the guy requesting that he be buried with all of his money. The wife kindly placed a check for the full amount in his coffin.

 

[smstonypoint]

And then there's the one about the guy requesting that he be buried with all of his money. The wife kindly placed a check for the full amount in his coffin.

With apologies in advance to the lawyers among us, this reminded me of one of my favorite jokes.

As Mr. Smith was on his death bed, he attempted to formulate a plan that would allow him to take at least some of his considerable wealth with him. He called for the three men he trusted most his lawyer, his doctor, and his clergyman. He told them, "I'm going to give you each $30,000 in cash before I die. At my funeral, I want you to place the money in my coffin so that I can try to take it with me." All three agreed to do this and were given the money.

At the funeral, each approached the coffin in turn and placed an envelope inside. While riding in the limousine to the cemetery, the clergyman said "I have to confess something to you fellows. Brother Smith was a good churchman all his life, and I know he would have wanted me to do this. The church needed a new baptistery very badly, and I took $10,000 of the money he gave me and bought one. I only put $20,000 in the coffin." The physician then said, "Well, since we're confiding in one another, I might as well tell you that I didn't put the full $30,000 in the coffin either. Smith had a disease that could have been diagnosed sooner if I had this very new machine, but the machine cost $20,000 and I couldn't afford it then. I used $20,000 of the money to buy the machine so that I might be able to save another patient. I know that Smith would have wanted me to do that." The lawyer then said, "I'm ashamed of both of you. When I put my envelope into that coffin, it held my personal check for the full $30,000."

Steve

 

[MossRoad]

Was flipping through the channels last night and PBS had one of their fundraisers going. Suze Orman was on. Again, one more financial adviser advising AGAINST WHOLE LIFE, don't ever, never buy it. Period. is pretty much what she and every other says. Term life only.