Getting Old or does my life insurance company know something?

kyleb

kyleb

Final Approach
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Marietta, GA
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Drake the Outlaw
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Cartersville, GA
About the time my son was born I took out a half million dollar term life policy. It was an aviation friendly policy with no restrictions. It cost ~$750/yr.

It just expired and I wasn't planning on renewing it. Thankfully Prudential was kind enough to send a renewal offer anyway. It only went up to $23,000/yr.

Hmm.
 
Term policies do not accumulate cash value over the years - so premiums are predicted on an actuarial table that guestimates your likelihood of dying within the effective dates of the policy. As we age that likelihood increases greatly - hence the premium increases greatly.
 
You're good!! The shortest life expectancy policies are $25,000 a year, so you have some time left!
 
Yeah. I took out a 25 level term 26 years ago. My plan was that by the time the term expired, kids would be out of college and I'd have the cash in the 401k / IRA's that would be used by wife if I wasn't making income. When I retired a couple of years ago, I just let the life insurance expire / didn't renew.

So, depending on your IRA/401k balance and how close you are to retirement, you may just not need it any more.
 
kyleb said:
About the time my son was born I took out a half million dollar term life policy. It was an aviation friendly policy with no restrictions. It cost ~$750/yr.

It just expired and I wasn't planning on renewing it. Thankfully Prudential was kind enough to send a renewal offer anyway. It only went up to $23,000/yr.

Hmm.
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They’re giving you about 21 years. 500,000/23,000=21.73. Yeah,yeah, I know it’s not quite that simple. The question you must answer is, do you want people smiling at your funeral
 
luvflyin said:
They’re giving you about 21 years. 500,000/23,000=21.73. Yeah,yeah, I know it’s not quite that simple. The question you must answer is, do you want people smiling at your funeral
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I'm past the point of needing life insurance. That was the plan all along. But the proposed premium was staggering if mathematically plausible.
 
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kyleb said:
I'm past the point of needing life insurance. That was the plan all along. But the proposed premium was staggering if mathematically plausible.
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Yup, we dropped our life insurance several years ago. It was unneeded due to our net worth. No dependents. No debt.
 
No more life insurance and I plan on spending everything over the next few years. When I die I want it to be a sad day for EVERYbody.
 
Depending on what your probate/estate taxes may be, that $23k may be a real discount vs. paying them out of your estate assets. You can pay the $23k in tax, or you can let the proceeds from the policy take care of it, and the heirs pocket the balance.
 
Beachy said:
No more life insurance and I plan on spending everything over the next few years. When I die I want it to be a sad day for EVERYbody.
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We don’t need no stinking life insurance.

The perfect estate plan is actually a very simple thing.

Your executor writes out the last check to the funeral home, and it bounces.
 
Chip Sylverne said:
Depending on what your probate/estate taxes may be, that $23k may be a real discount vs. paying them out of your estate assets. You can pay the $23k in tax, or you can let the proceeds from the policy take care of it, and the heirs pocket the balance.
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Estate taxes don't begin until your estate has $14M in assets. At this point, it isn't a concern. ;-)
 
Daleandee said:
I've warned family & friends ... when you come to the reading of the will bring your checkbook as there's gonna be folks there looking for their money ... :biggrin:
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Ah.... planning your funeral with ticket master? Offer a package deal that includes post service buffet? Wrist bands or hand stamps?
 
kyleb said:
I'm past the point of needing life insurance. That was the plan all along. But the proposed premium was staggering if mathematically plausible.
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How long would the term have been on the new policy?
 
Chip Sylverne said:
Depending on what your probate/estate taxes may be, that $23k may be a real discount vs. paying them out of your estate assets. You can pay the $23k in tax, or you can let the proceeds from the policy take care of it, and the heirs pocket the balance.
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I've already responded to the estate part, BUT, from an income perspective there is an angle for life insurance. Let's say I paid the $23K for a few years then kicked. The payoff from insurance is tax free. So you're dodging income taxes on the backend (assuming you die in time ;-0), but are giving up the opportunity to invest that $23K every year with tax obligations at the end.
 
I done with life insurance and lifetime warranties…good planning early allows you to do it.
 
Randomskylane said:
I think that really depends on where you are…for state/ county
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There are no counties in the US with estate taxes. As far as state estate taxes go, not an issue for me or where I live.
 
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