Go Back  CorvetteForum - Chevrolet Corvette Forum Discussion > Off Topic > Off Topic
Reload this Page >

When to quit term life insurance and disability

Notices
Off Topic Off Topic | Non-Corvette

When to quit term life insurance and disability

 
Old 01-02-2019, 06:37 PM
  #1  
jasper711
CF Senior Member
Thread Starter
 
Member Since: Jul 2004
Location: Pacific N.W. Warshington
Posts: 14,774
Likes: 0
Received 7 Likes on 5 Posts
Default When to quit term life insurance and disability

These were income replacement policies that I had for many years to cover family needs if something happened to me. Family is now gone except for wife, and her cost of living can easily be covered by our retirement plan. It makes sense for me to terminate the policies, the need has passed. Am I overlooking anything?

thanks for any insights.

jasper711 is offline  
Old 01-02-2019, 06:39 PM
  #2  
WICKEDFRC
CF Senior Member
 
WICKEDFRC's Avatar
 
Member Since: Apr 2010
Location: Avatar designed by WickedFRC.
Posts: 12,349
Received 523 Likes on 287 Posts
Default

Monthly payment x 12 x estimated years of life expectancy. Is it worth the monthly payment? Can the funds be left to anyone else? If not, why make a monthly payment between now and then.

Tomorrow is never guaranteed. Enjoy today.

Last edited by WICKEDFRC; 01-02-2019 at 06:39 PM.
WICKEDFRC is offline  
Old 01-02-2019, 06:42 PM
  #3  
Gordon Shumway
CF Senior Member
 
Gordon Shumway's Avatar
 
Member Since: Feb 2008
Location: Ocala FL
Posts: 22,153
Received 9 Likes on 2 Posts
Default

I'd dump them as long as the wife is taken care if you croak without the term insurance. Why would you keep any disability insurance, if you are no longer working? What income will the policy replace?
Gordon Shumway is online now  
Old 01-02-2019, 06:46 PM
  #4  
Jupiterjj
Junior Member
 
Member Since: May 2017
Location: Orlando Florida
Posts: 11
Likes: 0
Received 1 Like on 1 Post
Default

There are companies that will buy life insurance policies from you, even term life. They give you a lump sum payment and make the payments. Google it.
Jupiterjj is offline  
Old 01-02-2019, 07:06 PM
  #5  
Greg00Coupe
CF Senior Member
 
Member Since: Aug 1999
Location: Canton Ohio
Posts: 5,959
Received 297 Likes on 223 Posts
Default

Generally the term life insurance concept assumes one will get to a financial position where they do not need insurance. If you’re there cancel.
Greg00Coupe is offline  
Old 01-02-2019, 07:27 PM
  #6  
63 340HP
CF Senior Member
 
63 340HP's Avatar
 
Member Since: Nov 2005
Location: Beach & High Desert Southern California
Posts: 16,059
Received 538 Likes on 323 Posts
Default

Disability Insurance benefits are typically 60% of the past two year's average monthly payroll income earnings, paid monthly, and end at normal retirement age. How many months/years/dollars do you expect to benefit from until then (and can you live well without the benefit).

Life insurance benefits are worthwhile if needed for the remaining spouse to pay off debts as needed to survive without the deceased's income or pension share.

If you have retirement accounts with a major broker or mutual fund management company, they probably have a CFA available to crunch the numbers for you to make an educated decision.
63 340HP is online now  
Old 01-02-2019, 08:08 PM
  #7  
jasper711
CF Senior Member
Thread Starter
 
Member Since: Jul 2004
Location: Pacific N.W. Warshington
Posts: 14,774
Likes: 0
Received 7 Likes on 5 Posts
Default

Originally Posted by Gordon Shumway View Post
I'd dump them as long as the wife is taken care if you croak without the term insurance. Why would you keep any disability insurance, if you are no longer working? What income will the policy replace?
I am still working, probably will for the next 10 years, but our retirement income could support us modestly now already.

Originally Posted by 63 340HP View Post
Disability Insurance benefits are typically 60% of the past two year's average monthly payroll income earnings, paid monthly, and end at normal retirement age. How many months/years/dollars do you expect to benefit from until then (and can you live well without the benefit).

Life insurance benefits are worthwhile if needed for the remaining spouse to pay off debts as needed to survive without the deceased's income or pension share.

If you have retirement accounts with a major broker or mutual fund management company, they probably have a CFA available to crunch the numbers for you to make an educated decision.
Very small retirement account but a few rental properties that we're in process of getting caught up on for maintenance. The rental income will exceed what is needed when retired assuming I am on medicare. The only open liability seems to be unknown medical insurance premium increases, for my wife who is younger. At this time that would easily be covered also.
jasper711 is offline  
Old 01-02-2019, 08:09 PM
  #8  
jasper711
CF Senior Member
Thread Starter
 
Member Since: Jul 2004
Location: Pacific N.W. Warshington
Posts: 14,774
Likes: 0
Received 7 Likes on 5 Posts
Default

Originally Posted by Jupiterjj View Post
There are companies that will buy life insurance policies from you, even term life. They give you a lump sum payment and make the payments. Google it.
These are term policies with zero residual value after the term is up. Intention was to cover needs till the kids left, that happened 4 years ago and we overlooked cancelling at that time.
jasper711 is offline  
Old 01-02-2019, 11:15 PM
  #9  
ratflinger
NCM Grand Opening Veteran
Support Corvetteforum!
 
ratflinger's Avatar
 
Member Since: Sep 2005
Location: Technology is NOT your friend!
Posts: 15,343
Received 49 Likes on 41 Posts
St. Jude Donor '11, '17
Default

Originally Posted by Jupiterjj View Post
There are companies that will buy life insurance policies from you, even term life. They give you a lump sum payment and make the payments. Google it.


ratflinger is offline  
Old 01-03-2019, 08:13 AM
  #10  
juiceman03070
CF Senior Member
Support Corvetteforum!
 
juiceman03070's Avatar
 
Member Since: Aug 2004
Location: Hamburger Hill...MAY 69
Posts: 22,438
Likes: 0
Received 2 Likes on 2 Posts
St. Jude Donor '08
Default whole life

I paid for years on a whole life and it came full circle were I was getting a dividend paid each year ..Cashed in and put it to work in a new investment and it makes three times what
it was paying . Dont ask details , all handles by financial adviser ..He helped me retire at 55 ..comfortably .
juiceman03070 is offline  
Old 01-03-2019, 08:27 AM
  #11  
VITIS
CF Senior Member
 
VITIS's Avatar
 
Member Since: Nov 2003
Location: Purdy MO
Posts: 2,604
Likes: 0
Received 0 Likes on 0 Posts
St. Jude Donor '15-'16,'18
Default

If term no longer serves its purpose, cancel. Might think of using payments to fund long term care policy.
VITIS is offline  
Old 01-03-2019, 08:35 AM
  #12  
Derrick Reynolds
CF Senior Member
 
Derrick Reynolds's Avatar
 
Member Since: Jul 2008
Location: In limbo
Posts: 16,765
Received 21 Likes on 11 Posts
St. Jude Donor '13-'14-'15, '17-'18
Default

Originally Posted by Jupiterjj View Post
There are companies that will buy life insurance policies from you, even term life. They give you a lump sum payment and make the payments. Google it.
Actually, I had never heard of that, so I did Google it. Apparently, you have to be over 70 years of age and/or terminally ill for investors to have any interest in buying your term policy. Even then, your policy might not qualify.
Derrick Reynolds is offline  
Old 01-03-2019, 08:44 AM
  #13  
VITIS
CF Senior Member
 
VITIS's Avatar
 
Member Since: Nov 2003
Location: Purdy MO
Posts: 2,604
Likes: 0
Received 0 Likes on 0 Posts
St. Jude Donor '15-'16,'18
Default

Originally Posted by PKguitar View Post
Actually, I had never heard of that, so I did Google it. Apparently, you have to be over 70 years of age and/or terminally ill for investors to have any interest in buying your term policy. Even then, your policy might not qualify.
FIL had a "financial advisor" sell him life insurance policies on AIDs patients. Lost about $40K on that scam.
VITIS is offline  
Old 01-03-2019, 08:52 AM
  #14  
acroy
CF Senior Member
 
acroy's Avatar
 
Member Since: Jun 2013
Location: DFW TX
Posts: 1,890
Received 155 Likes on 119 Posts
Default

do the math on how much Wife needs to get by; and how much will she be able to get from your retirement savings + SS survivor benefits.

I carried $1M life insurance policy on myself from age 28-38. Dropped at age 38 because by then I had NW of about 600k. Using that + SS survivor bennies + the modest life insurance policy provided by my employer, and she and the kids would have 4k+ per month income forever, which is plenty to live comfortably.

Last edited by acroy; 01-03-2019 at 08:53 AM.
acroy is offline  
Old 01-03-2019, 09:17 AM
  #15  
chaase
CF Senior Member
 
chaase's Avatar
 
Member Since: May 2003
Location: East Meadow NY
Posts: 23,321
Received 5 Likes on 5 Posts
St. Jude Donor '12
Default

No kids and the house is paid off so I ditched the term life insurance. My wife has a job so no need to worry about her.
chaase is offline  
Old 01-03-2019, 09:27 AM
  #16  
Kenny94945
CF Senior Member
 
Kenny94945's Avatar
 
Member Since: Oct 2000
Location: Sausalito CA
Posts: 4,725
Received 216 Likes on 191 Posts
Default

From your post seems only family member you have now is your wife.
She can support herself without you by the retirement plan.
Seems you answered you own question about the term life insurance.
But based on cost, a $25K policy could give you a nice funeral or mad money for wife to help with her grieving.

Disability policy...need more info, so I can not offer any 2 cent comments.
Good luck.
Kenny94945 is online now  
Old 01-03-2019, 10:00 AM
  #17  
Vetteman Jack
Moderator
Support Corvetteforum!
 
Vetteman Jack's Avatar
 
Member Since: Mar 2001
Location: Missouri. Currently own 2014 Stingray Coupe.
Posts: 272,161
Received 4,598 Likes on 3,929 Posts
MO Events Coordinator
St. Jude Co-Organizer
St. Jude Donor '03-'04-'05-'06-'07-'08-'09-'10-'11-'12-'13-'14-'15-'16-'17-'18-'19
NCM Sinkhole Donor
CI 5, 8 & 11 Veteran

Default

Originally Posted by VITIS View Post
If term no longer serves its purpose, cancel. Might think of using payments to fund long term care policy.
Good advice. Long term care, if ever needed, can wipe out a personís financial standing.
Vetteman Jack is offline  
Old 01-03-2019, 10:31 AM
  #18  
LS14ME2
CF Senior Member
 
LS14ME2's Avatar
 
Member Since: Jul 2012
Posts: 2,640
Received 9 Likes on 8 Posts
Default

We are in the same position. Our term life was to pay off the house and other bills should something have happened to either of us. In the meantime, house is now paid off and no loans, etc.

I think we have a couple more years to go and we will let it expire. It has served its purpose.
LS14ME2 is offline  
Old 01-03-2019, 02:12 PM
  #19  
jasper711
CF Senior Member
Thread Starter
 
Member Since: Jul 2004
Location: Pacific N.W. Warshington
Posts: 14,774
Likes: 0
Received 7 Likes on 5 Posts
Default

Originally Posted by PKguitar View Post
Actually, I had never heard of that, so I did Google it. Apparently, you have to be over 70 years of age and/or terminally ill for investors to have any interest in buying your term policy. Even then, your policy might not qualify.

If the actuaries calculate our continuing subscription based on some value from past terms, there COULD be an advantage to keep this going personally (if we don't need the funds). No earthly purpose for this in our lifes, it would be only to boost the estate by $250k at end of life. Premiums are capped at 6% raise, per year, so I need to do some math.

Interesting to think about, but I am getting a headache .

There is the possibility of a slight rule change cancelling the 6% cap, and the whole scheme goes up in smoke.
jasper711 is offline  
Old 01-03-2019, 07:40 PM
  #20  
Humanoid 2.0
CF Senior Member
 
Humanoid 2.0's Avatar
 
Member Since: Jul 2004
Location: .... NJ
Posts: 76,302
Received 31 Likes on 31 Posts
Cruise-In VII Veteran
St. Jude Donor '05-'06-'07-'08-'09-'10-'11-'12-'13-'14-'15-'16-'17-'18

Default

If you don't need it than dump it. The older you get the more it cost as well if you were to renew the term.
Humanoid 2.0 is offline  

Thread Tools
Search this Thread
Quick Reply: When to quit term life insurance and disability


Contact Us - About Us - Archive - Advertising - Cookie Policy - Privacy Statement - Terms of Service

© 2019 MH Sub I, LLC dba Internet Brands

We are a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for us to earn fees by linking to Amazon.com and affiliated sites.
 
  • Ask a Question
    Get answers from community experts
Question Title:
Description:
Your question will be posted in: