Is It Worth It To Have A Life Insurance Policy?
Posted September 21, 2009 – 5:25 pm in: structured settlements FAQim in my late 20’s. 3 yrs ago i set a life insurance policy. it is 3000 a yr and im going to be paying for it for 12 yrs. after that the policy value increases. is it worth it in the long run? who has done it out there?
Tags: Have, Insurance, Life, Policy, Worth
4 Comments
Life insurance is purchased to cover financial needs that you cannot cover based on your current assets. If you do not have a wife or children, then your need for insurance is low. You would just need some money to cover funeral expenses and possibly some admin costs to administer your estate. Of course, if you have $20,000 or so in assets, then you probably don’t need insurance. If you have a family, then you might need more insurance to cover any lost income that you provide the family. Some also opt for enough insurance to pay off a mortgage and even put the children through college. It all depends on what expenses you want to cover. If you just want to cover your lost income, a good rule of thumb is 10 times your annual salary.
I do think you are overpaying for your insurance. You should look at term life instead of the expensive whole or universal life you have now. You could get a half million in term for $600 a year or less (depending on your health). Permanent insurance policies take a decade just to get back to breakeven (meaning the cash value equals the premiums paid).
All my best,
Kirk
Build Your Wealth – http://www.swimupstreamtowealth.com
lifeinsurance.awardspace.info – you can try this company. My parents have their life insurance.
It all depends on what you’re protecting. Ideally you should have enough to cover all burial expenses and to likely pay off any debt you may have at the time. Anything else had better be for loved ones. Clearly, if you have a spouse and/or children, it makes much more sense. You’d then want a bigger policy so it could pay off the mortgage and/or give any children a good shot at paying for their education. Basically enough money so that it replaces your lost income. But if you’re single and have no debt, what’s the point? Life insurance is for those who are still here, not for you. Anything beyond that and you’re just wasting money you could be spending enjoying what you have.
One of the musts in ur insurance kitty is term plan.
y??
They offer u high insurance value at little cost..example : insured of Rs 20 Lakhs (as we had discussed in previous post) costs u only 5722 Rs per annum, while a money back plan costs u a whopping 67000.
So y is the term plan so cheap..the flip side is..if u happen to survive the insured period (say 25 yrs), u dont get a dime back.that means an amount of (5722*25) 1,43,000 goes down the drain.
So shud u go for it?????????? Ofcourse..there is no doubt about it..It is mandatory..the low costs outweigh the negatives.
Also u can go for a mix of policies…more abt that latter.