Posted: Fri Jul 11, 2008 9:13 pm Post subject: when to surrender a whole life policy?
I have an insurance question:
I am married, age 60, with a $75,000 whole life policy on myself. Premium is $115 a month, and Cash Surrender Value is approximately $20,000. I recall the policy projections showed the cash surrender value would start to erode in my 60's, as mortality probability increases. I also just read that this is common, and to consider surrendering the policy, but no time frame was suggested.
We don't need the life insurance coverage for estate taxes, and my wife's income (she's a realtor) has plummeted dramatically. She's tired of that business, so who knows what the future holds regarding future earning potential (she's late 50-something). Health insurance coverage is a big issue ($780/month just for her - I have single coverage from my employer).
Based on the facts presented, should we consider cashing in my whole life policy?
Posted: Sun Jul 13, 2008 3:08 pm Post subject: Surrendering Whole Life Policy?
Lots of topics to discuss here... The policy is an assett for you for sure. Ask the company about taking out some of the cash value (loan). you would still be able to keep the policy in force and if something does happen to you, your wife would recieve the benefit minus the loaned amount. Also, at this point, you are actually paying $115.00 per month for a $55,000 policy since you have the cash value built up. Some other things to consider here:
1: Is it the idea of losing a $115.00 bill that is appeealing to you?
2: Have you considered purchasing a single premium whole life policy with a portion of the cash value to cover expenses? ex: take $5,000 out of the policy to purchase a $10,000 policy with no further premiums due.
3: Holy cow, that's a pretty expensive health insurance premium, considered shopping that rate?
e-mail me if you have any questions, trahitt[at]yahoo.com
*email id deactivated for your safety-lakemen _________________ Register Now to have your Insurance queries solved.
Posted: Sun Jul 13, 2008 9:43 pm Post subject: insurance
Please excuse my 'lack of knowledge' here, but......I din't know you can ACTUALLY surrender a Life Insurance policy. I'm just curious..for what reason would you want to do that? To get the money from it? To get a 'better' ( lack of a better word..) policy....one that may better suit your needs NOW?
Based on the facts presented, should we consider cashing in my whole life policy?
NonsmokinJoe in my *SAFE opinion I would say...
Yes, no, maybe....just to be clear!
Life insurance is about financially protecting mama and the kids
should you suddenly be eaten alive, head first, by a Big Mac Truck;
and/or you simply don't wake up tomorrow morning.
The question to be answered is:
If you don't wake up tomorrow morning will mama and kids,... financially get along just fine,... without your income and the $75,000 from your policy?
If you were my client I'd recommend you apply for 20 year level term insurance. The premium for a male age 60, PREFERRED PLUS NON-TOBACCO, for $150,000 would be $117.73 per month if you qualify.
Once approved...I'd cash out the $20,000 and invest it in whatever is SAFE and sound for the protection of the cash asset or 1035 exchange for a better contract with a No Lapse Guarantee.
Now if you go bye-bye unexpectedly mama and the kids now have a minimum of $170,000 (life ins. + the cash) AND you are paying right at the same amount of money per month so your monthly budget is not affected.
To implement said plan, take a vacation to the Tampa Bay, Florida area and.... _________________ Gary Spicuzza, *SAFE
Copyright 1956.
No rights reserved.
*Self Appointed Financial Expert
Before you surrender your life insurance policy in order for you to get the cash values, you should try to consider some things. As we all know, life insurance is for financial protection that when something will happen to you, your beneficiaries will still survive by using the money that is from the insurance proceeds. Now the question here is, Is life insurance still a necessity? Do you still need financial protection? If something would happen to you, would your family be financially stable? I think in that age of yours, I assume that your family can now survive with out your financial aid. If you don't see the need for life insurance in that age, you can surrender it and get the cash values. You can use it to additional funds for your retirement. That is one thing that you need to consider. The need for life insurance. We buy it because we know we need it. If the time comes that you don't need it, surrender it and enjoy the benefit that it will give you. _________________ A life worth living...
