I’m a 23F with a whole life insurance policy from Globe Life. My mother opened it up for me when I was 1. I want to cash it out and find a term life policy ( not sure what company though ) but she’s begging me not to.
I also have a 9 month old that I opened whole life insurance for under my policy. For both of our policies, it’s a little over $300 a year. I have 35,000 and my daughter has 45,000.
I’m not really sure what to do.
Why do you feel you need to cash out the whole life policy? Just add an additional term policy.
I thought cashing it out would cancel the policy and I could use that money to get a term life policy.
As a healthy 23 year old women the price for a term policy is going to be the cost of a cup of coffee weekly.
I suggest asking Globe Life to redirect the dividend to cover the premium, so you won’t have to pay anything extra.
This is an option for sure and not a bad one at all to keep the death benefit forever as a solid final expense policy.
Since your mom wants you to keep the whole life policy, have her cover the premium. That policy has been active for 22 years; consider how much cash value you’ll get compared to the death benefit. You can still get a term policy.
Remember, whole life premiums stay the same, but term premiums will increase after 10, 20, or 30 years, depending on the term you choose. By then, you’ll be older, and insurance will cost more.
Insurance is meant to replace your income for those who depend on you.
Read a few articles that explain the problems with whole life insurance. After that, send them to your mother and ask her to read them. Here are the links:
People might say you’ve already lost money, but your funds are better invested in term life insurance plus investing the difference.
I recommend getting term quotes from term4sale.com.
Also, consider waiting until you have dependents since right now, no one else relies on your income.
This is the right answer.
Cancel both policies, buy term life insurance, and invest the difference in premiums into your 401(k) or another investment. While many people here may disagree, the truth is that whole life insurance isn’t a good investment for most people, and you don’t need coverage for your entire life.
Stop looking at whole life as an investment.
say that you needed perm coverage, what’s the benefit of choosing WL over GUL or even ULSG if it’s not an investment?
She could 1035 exchange the money into a UL for sure, but the rising COI may not make sense and it would potentially have a lower DB.