Seeking term life insurance recommendation

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bogleraw
Posts: 90
Joined: Fri Jun 01, 2012 11:47 am

Seeking term life insurance recommendation

Post by bogleraw » Tue Dec 05, 2017 12:52 am

Hi all,

I am seeking a recommendation on term life insurance amounts.

I am 33 yrs old and my wife just turned 34. We have a 3 year old son and a baby girl due in January. I am long overdue on working on our wills and life insurance etc, but have plans to talk to a tax + life insurance firm tomorrow about this.

We live in a HCOL area.

My income is $180k+25k bonus+$150k RSUs / year
Her income is $72k/year

Monthly expenses: Mortgage is $4600 (mortgage balance = $793k), childcare expected to be $3400 for both kids, monthly expenses averaging $4000 (Total = $12k). Credit cards are paid in full.

We max out our 401k's and IRAs each year.
We have $210k in equity in our house and $700k in investments across IRAs and brokerage accounts.

Through my employer, I have 5x Salary - Supplemental Employee Life Insurance $900k and 2x Salary - $360,000 Accidental death and disability benefits.

Could you please recommend what term life insurance amount and duration I should consider for myself and my wife?

Besides getting term life insurance and our wills together, is there anything else you recommend getting in order before our little one arrives?

Thank you!
Last edited by bogleraw on Tue Dec 05, 2017 1:09 am, edited 1 time in total.

technovelist
Posts: 2687
Joined: Wed Dec 30, 2009 9:02 pm
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Re: Seeking term life insurance recommendation

Post by technovelist » Tue Dec 05, 2017 12:58 am

bogleraw wrote:
Tue Dec 05, 2017 12:52 am
Hi all,

I am seeking a recommendation on term life insurance amounts.

I am 33 yrs old and my wife just turned 34. We have a 3 year old son and a baby girl due in January. I am long overdue on working on our wills and life insurance etc, but have plans to talk to a tax + life insurance firm tomorrow about this.

We live in a HCOL area.

My income is $180k+25k bonus+$150k RSUs / year
Her income is $72k/year

Monthly expenses: Mortgage is $4600, childcare expected to be $3400 for both kids, monthly expenses averaging $4000 (Total = $12k). Credit cards are paid in full.

We max out our 401k's and IRAs each year.
We have $210k in equity in our house and $700k in investments across IRAs and brokerage accounts.

Through my employer, I have 5x Salary - Supplemental Employee Life Insurance $900k and 2x Salary - $360,000 Accidental death and disability benefits.

Could you please recommend what term life insurance amount and duration I should consider for myself and my wife?

Besides getting term life insurance and our wills together, is there anything else you recommend getting in order before our little one arrives?

Thank you!
I would say you need at least $3 million on you and $1 million on your wife, 30 year level term. How is your health and hers?

Also, may I ask what state you live in?
In theory, theory and practice are identical. In practice, they often differ.

bogleraw
Posts: 90
Joined: Fri Jun 01, 2012 11:47 am

Re: Seeking term life insurance recommendation

Post by bogleraw » Tue Dec 05, 2017 1:03 am

technovelist wrote:
Tue Dec 05, 2017 12:58 am
bogleraw wrote:
Tue Dec 05, 2017 12:52 am
Hi all,

I am seeking a recommendation on term life insurance amounts.

I am 33 yrs old and my wife just turned 34. We have a 3 year old son and a baby girl due in January. I am long overdue on working on our wills and life insurance etc, but have plans to talk to a tax + life insurance firm tomorrow about this.

We live in a HCOL area.

My income is $180k+25k bonus+$150k RSUs / year
Her income is $72k/year

Monthly expenses: Mortgage is $4600, childcare expected to be $3400 for both kids, monthly expenses averaging $4000 (Total = $12k). Credit cards are paid in full.

We max out our 401k's and IRAs each year.
We have $210k in equity in our house and $700k in investments across IRAs and brokerage accounts.

Through my employer, I have 5x Salary - Supplemental Employee Life Insurance $900k and 2x Salary - $360,000 Accidental death and disability benefits.

Could you please recommend what term life insurance amount and duration I should consider for myself and my wife?

Besides getting term life insurance and our wills together, is there anything else you recommend getting in order before our little one arrives?

Thank you!
I would say you need at least $3 million on you and $1 million on your wife, 30 year level term. How is your health and hers?

Also, may I ask what state you live in?
Thanks for the feedback! Could you please clarify how you arrive at those numbers for guidance? Do you take into account the amounts I get through my employer as well?
We are both in good health (no medications etc.), work out regularly. I could probably stand to lose 10 pounds :) We live in California.

technovelist
Posts: 2687
Joined: Wed Dec 30, 2009 9:02 pm
Contact:

Re: Seeking term life insurance recommendation

Post by technovelist » Tue Dec 05, 2017 1:12 am

bogleraw wrote:
Tue Dec 05, 2017 1:03 am
technovelist wrote:
Tue Dec 05, 2017 12:58 am
bogleraw wrote:
Tue Dec 05, 2017 12:52 am
Hi all,

I am seeking a recommendation on term life insurance amounts.

I am 33 yrs old and my wife just turned 34. We have a 3 year old son and a baby girl due in January. I am long overdue on working on our wills and life insurance etc, but have plans to talk to a tax + life insurance firm tomorrow about this.

We live in a HCOL area.

My income is $180k+25k bonus+$150k RSUs / year
Her income is $72k/year

Monthly expenses: Mortgage is $4600, childcare expected to be $3400 for both kids, monthly expenses averaging $4000 (Total = $12k). Credit cards are paid in full.

We max out our 401k's and IRAs each year.
We have $210k in equity in our house and $700k in investments across IRAs and brokerage accounts.

Through my employer, I have 5x Salary - Supplemental Employee Life Insurance $900k and 2x Salary - $360,000 Accidental death and disability benefits.

Could you please recommend what term life insurance amount and duration I should consider for myself and my wife?

Besides getting term life insurance and our wills together, is there anything else you recommend getting in order before our little one arrives?

Thank you!
I would say you need at least $3 million on you and $1 million on your wife, 30 year level term. How is your health and hers?

Also, may I ask what state you live in?
Thanks for the feedback! Could you please clarify how you arrive at those numbers for guidance? Do you take into account the amounts I get through my employer as well?
We are both in good health (no medications etc.), work out regularly. I could probably stand to lose 10 pounds :) We live in California.
Well, obviously you are the big earner so you need to be covered for the most money, about 20 years expenses. And for your wife, you would need to be able to hire additional help if something happened to her, for roughly the next 15-20 years at least.

You can't really count on your employer's insurance for a number of reasons, including the fact that if you get sick or are injured and then lose your job as a result, you will also lose your coverage. Another reason is that you might change employers at a time when you are uninsurable or in a much worse rating class.

Your weight is probably not going to be a problem, as the weight tables are pretty generous these days. So if you are otherwise in good health, you should be able to buy a lot of 30 year term for a small premium relative to your income.

By the way, I am a licensed agent in California and would be happy to go over whatever you would like to discuss in any detail you wish to discuss it in. That includes giving you a second opinion on whatever the firm you visit tomorrow suggests. I will not try to sell you anything.
In theory, theory and practice are identical. In practice, they often differ.

bogleraw
Posts: 90
Joined: Fri Jun 01, 2012 11:47 am

Re: Seeking term life insurance recommendation

Post by bogleraw » Tue Dec 05, 2017 1:24 am

technovelist wrote:
Tue Dec 05, 2017 1:12 am
bogleraw wrote:
Tue Dec 05, 2017 1:03 am
technovelist wrote:
Tue Dec 05, 2017 12:58 am
bogleraw wrote:
Tue Dec 05, 2017 12:52 am
Hi all,

I am seeking a recommendation on term life insurance amounts.

I am 33 yrs old and my wife just turned 34. We have a 3 year old son and a baby girl due in January. I am long overdue on working on our wills and life insurance etc, but have plans to talk to a tax + life insurance firm tomorrow about this.

We live in a HCOL area.

My income is $180k+25k bonus+$150k RSUs / year
Her income is $72k/year

Monthly expenses: Mortgage is $4600, childcare expected to be $3400 for both kids, monthly expenses averaging $4000 (Total = $12k). Credit cards are paid in full.

We max out our 401k's and IRAs each year.
We have $210k in equity in our house and $700k in investments across IRAs and brokerage accounts.

Through my employer, I have 5x Salary - Supplemental Employee Life Insurance $900k and 2x Salary - $360,000 Accidental death and disability benefits.

Could you please recommend what term life insurance amount and duration I should consider for myself and my wife?

Besides getting term life insurance and our wills together, is there anything else you recommend getting in order before our little one arrives?

Thank you!
I would say you need at least $3 million on you and $1 million on your wife, 30 year level term. How is your health and hers?

Also, may I ask what state you live in?
Thanks for the feedback! Could you please clarify how you arrive at those numbers for guidance? Do you take into account the amounts I get through my employer as well?
We are both in good health (no medications etc.), work out regularly. I could probably stand to lose 10 pounds :) We live in California.
Well, obviously you are the big earner so you need to be covered for the most money, about 20 years expenses. And for your wife, you would need to be able to hire additional help if something happened to her, for roughly the next 15-20 years at least.

You can't really count on your employer's insurance for a number of reasons, including the fact that if you get sick or are injured and then lose your job as a result, you will also lose your coverage. Another reason is that you might change employers at a time when you are uninsurable or in a much worse rating class.

Your weight is probably not going to be a problem, as the weight tables are pretty generous these days. So if you are otherwise in good health, you should be able to buy a lot of 30 year term for a small premium relative to your income.

By the way, I am a licensed agent in California and would be happy to go over whatever you would like to discuss in any detail you wish to discuss it in. That includes giving you a second opinion on whatever the firm you visit tomorrow suggests. I will not try to sell you anything.
Thank you! Based on your explanation, did you mean to suggest the 20 year term instead of 30 years? Difference in price for the two terms is quite significant.
Thanks for the offer as well, I will send you a PM after the meeting tomorrow. :)

technovelist
Posts: 2687
Joined: Wed Dec 30, 2009 9:02 pm
Contact:

Re: Seeking term life insurance recommendation

Post by technovelist » Tue Dec 05, 2017 1:29 am

bogleraw wrote:
Tue Dec 05, 2017 1:24 am
technovelist wrote:
Tue Dec 05, 2017 1:12 am
bogleraw wrote:
Tue Dec 05, 2017 1:03 am
technovelist wrote:
Tue Dec 05, 2017 12:58 am
bogleraw wrote:
Tue Dec 05, 2017 12:52 am
Hi all,

I am seeking a recommendation on term life insurance amounts.

I am 33 yrs old and my wife just turned 34. We have a 3 year old son and a baby girl due in January. I am long overdue on working on our wills and life insurance etc, but have plans to talk to a tax + life insurance firm tomorrow about this.

We live in a HCOL area.

My income is $180k+25k bonus+$150k RSUs / year
Her income is $72k/year

Monthly expenses: Mortgage is $4600, childcare expected to be $3400 for both kids, monthly expenses averaging $4000 (Total = $12k). Credit cards are paid in full.

We max out our 401k's and IRAs each year.
We have $210k in equity in our house and $700k in investments across IRAs and brokerage accounts.

Through my employer, I have 5x Salary - Supplemental Employee Life Insurance $900k and 2x Salary - $360,000 Accidental death and disability benefits.

Could you please recommend what term life insurance amount and duration I should consider for myself and my wife?

Besides getting term life insurance and our wills together, is there anything else you recommend getting in order before our little one arrives?

Thank you!
I would say you need at least $3 million on you and $1 million on your wife, 30 year level term. How is your health and hers?

Also, may I ask what state you live in?
Thanks for the feedback! Could you please clarify how you arrive at those numbers for guidance? Do you take into account the amounts I get through my employer as well?
We are both in good health (no medications etc.), work out regularly. I could probably stand to lose 10 pounds :) We live in California.
Well, obviously you are the big earner so you need to be covered for the most money, about 20 years expenses. And for your wife, you would need to be able to hire additional help if something happened to her, for roughly the next 15-20 years at least.

You can't really count on your employer's insurance for a number of reasons, including the fact that if you get sick or are injured and then lose your job as a result, you will also lose your coverage. Another reason is that you might change employers at a time when you are uninsurable or in a much worse rating class.

Your weight is probably not going to be a problem, as the weight tables are pretty generous these days. So if you are otherwise in good health, you should be able to buy a lot of 30 year term for a small premium relative to your income.

By the way, I am a licensed agent in California and would be happy to go over whatever you would like to discuss in any detail you wish to discuss it in. That includes giving you a second opinion on whatever the firm you visit tomorrow suggests. I will not try to sell you anything.
Thank you! Based on your explanation, did you mean to suggest the 20 year term instead of 30 years? Difference in price for the two terms is quite significant.
Thanks for the offer as well, I will send you a PM after the meeting tomorrow. :)
It is possible that just about the worst time for you to die might be shortly before retirement, because then your wife will have only one Social Security payment to live on (besides your assets, of course). That depends on a lot of other data that I don't have yet. Obviously in that case you would want 30 years. I'd rather err on the side of caution, not knowing what things will look like that far off.

I look forward to your PM. Do you have any idea when it might be, so that I can be sure to be available to answer it?

Thanks!
In theory, theory and practice are identical. In practice, they often differ.

bogleraw
Posts: 90
Joined: Fri Jun 01, 2012 11:47 am

Re: Seeking term life insurance recommendation

Post by bogleraw » Tue Dec 05, 2017 2:11 am

I would appreciate more responses if anybody could spare their thoughts! Thanks!

ivk5
Posts: 56
Joined: Thu Sep 22, 2016 9:05 am

Re: Seeking term life insurance recommendation

Post by ivk5 » Tue Dec 05, 2017 3:32 am

Went through this recently. Some thoughts, in no particular order:

Stay focused on level premium term. Seems like you already are but just in case (or for benefit of others reading). Permanent insurance eg whole life is likely unsuitable for the vast majority of people it's sold to. Not aware of any scenarios where informed/disinterested observers would suggest considering insurance with a permanent death benefit unless you need to provide for a special needs child who may survive you or if you have an illiquid family business whose value is likely to exceed estate tax exemption under current law. Insurance is not an investment, no matter what you're told by someone who stands to earn a sizable commission by convincing you otherwise.

Consider whether you may have more kids or are definitely stopping at two. May affect timing as well as anticipated expenses (college etc).

Don't rely on employer-provided insurance. In addition to all the good reasons noted by technovelist, even if you stay at the same employer you may be subject to future benefit changes that you may have little/no control over. You need an individual policy that follows you wherever you go, whether you work or not, with no strings attached as long as you pay the premium.

Shop rates on termforsale.com if you're in good health with uncomplicated health history. This is a fairly simple commodity product (unlike disability, for example). Even if you buy through an agent/broker other than one you find through termforsale, you'll know how much of a premium you're paying for that choice. (What "tax + life insurance firm" are you talking to? Yellow flag to me. That sounds like a firm that may push you toward complex and expensive products/services you don't need.)

Insurance is not about replacing income, it's about covering expenses. Multiples of income are a poor yardstick. Depending on taxes/savings, two families with similar income may have very different expenses.

Figuring right benefit amount is not an exact science. That said, I made a spreadsheet projecting annual need through when last kid is out of college, with line items for family housing/living expenses, childcare/education/college, etc, with some assumptions about both general inflation and college tuition inflation rates. For this purpose I ignored accumulation of assets / increasing ability to self-insure. This was less to come up with a bottom-up number, more to validate that I was in right ballpark and to see change in need over time. Latter was important in deciding to ladder policies (more below).

Better too much than too little for many reasons including some noted by technovelist:
- Term is cheap
- Changes in health status may make it much more expensive to buy more insurance in future (or you may become uninsurable)
- Inflation risk- your nominally fixed death benefit is a declining benefit in real terms (pace may be faster or slower than decline of benefit needed)
- I'm no expert but believe with many level term policies you can reduce benefits while policy is in force and get pro rata reduction in premium (except for fixed policy fee portion) - but check with your agent/broker - technovelist may have more insight
- With 2nd kid on the way (and especially if you plan/hope for more), current projection of expenses/need may turn out to be on the low side

Consider laddering policies. Can be good hedge to the "better too much than too little" approach, and a good way to address the balloon cost of college especially when you are planning/hoping for more kid(s) at time of underwriting. For me, 30y was about 2x cost of 20y for same benefit amount. I ended up doing 50/50 split for myself between 20y and 30y, just 20y for spouse. Total insurance on lower-income spouse is half of my amount (ie similar 20y policy, just skipped the 30y) - delta in earning capacity and college timing/expenses drove that decision for us.

Edited to add:
bogleraw wrote:
Tue Dec 05, 2017 12:52 am
Besides getting term life insurance and our wills together, is there anything else you recommend getting in order before our little one arrives?
Disability. Good individual own-occupation long-term disability policy. Search forum, lots of good info (BruDude is one frequent poster who I believe is a disability insurance agent and has provided lots of good guidance in other threads).

technovelist
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Re: Seeking term life insurance recommendation

Post by technovelist » Tue Dec 05, 2017 4:23 am

ivk5 wrote:
Tue Dec 05, 2017 3:32 am
Went through this recently. Some thoughts, in no particular order:

Stay focused on level premium term. Seems like you already are but just in case (or for benefit of others reading). Permanent insurance eg whole life is likely unsuitable for the vast majority of people it's sold to. Not aware of any scenarios where informed/disinterested observers would suggest considering insurance with a permanent death benefit unless you need to provide for a special needs child who may survive you or if you have an illiquid family business whose value is likely to exceed estate tax exemption under current law. Insurance is not an investment, no matter what you're told by someone who stands to earn a sizable commission by convincing you otherwise.
Absolutely correct.
ivk5 wrote:
Tue Dec 05, 2017 3:32 am
Consider whether you may have more kids or are definitely stopping at two. May affect timing as well as anticipated expenses (college etc).

Don't rely on employer-provided insurance. In addition to all the good reasons noted by technovelist, even if you stay at the same employer you may be subject to future benefit changes that you may have little/no control over. You need an individual policy that follows you wherever you go, whether you work or not, with no strings attached as long as you pay the premium.

Shop rates on termforsale.com if you're in good health with uncomplicated health history. This is a fairly simple commodity product (unlike disability, for example). Even if you buy through an agent/broker other than one you find through termforsale, you'll know how much of a premium you're paying for that choice. (What "tax + life insurance firm" are you talking to? Yellow flag to me. That sounds like a firm that may push you toward complex and expensive products/services you don't need.)

Insurance is not about replacing income, it's about covering expenses. Multiples of income are a poor yardstick. Depending on taxes/savings, two families with similar income may have very different expenses.

Figuring right benefit amount is not an exact science. That said, I made a spreadsheet projecting annual need through when last kid is out of college, with line items for family housing/living expenses, childcare/education/college, etc, with some assumptions about both general inflation and college tuition inflation rates. For this purpose I ignored accumulation of assets / increasing ability to self-insure. This was less to come up with a bottom-up number, more to validate that I was in right ballpark and to see change in need over time. Latter was important in deciding to ladder policies (more below).

Better too much than too little for many reasons including some noted by technovelist:
- Term is cheap
- Changes in health status may make it much more expensive to buy more insurance in future (or you may become uninsurable)
- Inflation risk- your nominally fixed death benefit is a declining benefit in real terms (pace may be faster or slower than decline of benefit needed)
- I'm no expert but believe with many level term policies you can reduce benefits while policy is in force and get pro rata reduction in premium (except for fixed policy fee portion) - but check with your agent/broker - technovelist may have more insight
- With 2nd kid on the way (and especially if you plan/hope for more), current projection of expenses/need may turn out to be on the low side
Yes, indeed it is possible in many cases to reduce the benefit while the policy in force with a corresponding reduction in premium. However, if you know your requirements will go down, the laddering approach below is better.

Why? Because the early years of the policy have very little risk for the insurer. Thus, paying a higher premium for more coverage in those earlier years, then reducing the face amount later, is a better deal for the insurer than it is for you. On the other hand, laddering means that you are paying less right away for the shorter policy.
ivk5 wrote:
Tue Dec 05, 2017 3:32 am

Consider laddering policies. Can be good hedge to the "better too much than too little" approach, and a good way to address the balloon cost of college especially when you are planning/hoping for more kid(s) at time of underwriting. For me, 30y was about 2x cost of 20y for same benefit amount. I ended up doing 50/50 split for myself between 20y and 30y, just 20y for spouse. Total insurance on lower-income spouse is half of my amount (ie similar 20y policy, just skipped the 30y) - delta in earning capacity and college timing/expenses drove that decision for us.

Edited to add:
bogleraw wrote:
Tue Dec 05, 2017 12:52 am
Besides getting term life insurance and our wills together, is there anything else you recommend getting in order before our little one arrives?
Disability. Good individual own-occupation long-term disability policy. Search forum, lots of good info (BruDude is one frequent poster who I believe is a disability insurance agent and has provided lots of good guidance in other threads).
Also absolutely correct, assuming you can still get such a policy, which I didn't know was possible. I thought "any suitable occupation" policies, far less desirable, were all that you could get these days.
In theory, theory and practice are identical. In practice, they often differ.

xiangan55
Posts: 15
Joined: Tue Nov 22, 2011 8:14 pm

Re: Seeking term life insurance recommendation

Post by xiangan55 » Tue Dec 05, 2017 4:57 pm

Life Insurance is a personal decision and depends on what you're trying to accomplish.

I'm 32 years old with a 2 year old and with a similar income / net worth range as yourself, planning a second child.

When calculating the insurance policy required to replace my income, the premiums were very high (IMO) to use our free cash-flow for.

In the end, we decided on a $1M+ 20-year term life insurance after looking at a few quotes from PolicyGenius.

We could have opted 30-year term, but there was a large price-diff. and I figured by the time I'm 50+ years old, our net worth will be much higher (alleviating some need for life insurance), along with the kids being older.

$1M+ tax-free won't be enough replace our future earnings if I were to pass away today, but my wife/son would certainly not be destitute, which we're comfortable with and was our goals. Worse case, during the period she could be alone working with very young children, that time range we're covered. When we're older not so much but we have other savings we're building up (i.e. college)

Just 2 cents.

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TNL
Posts: 310
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Re: Seeking term life insurance recommendation

Post by TNL » Tue Dec 05, 2017 5:05 pm

Great advice up above. I will just add, if you are eligible for USAA, this is a great place to get quotes for term life. At age 39, I was able to get a $1.5 million 20 year term policy for about $81 a month. I was in the healthiest category so this saved some money on the premium. I am a single parent and my child was 6 at the time. The policy will lapse when I am 59 and my child is 26. At that point, college should be finished and I will be self insured. Good luck!

John Laurens
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Re: Seeking term life insurance recommendation

Post by John Laurens » Tue Dec 05, 2017 5:10 pm

I would look towards 2 million for 20 year term for you. $500k 10 year term on your wife.

Regards,
John

bloom2708
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Re: Seeking term life insurance recommendation

Post by bloom2708 » Tue Dec 05, 2017 5:11 pm

Do a ladder.

10 year: $500k
20 year: $500k
30 year: $500k

As your wealth grows, your need for term insurance drops. Use whatever amounts you need and feel like it is enough. $300k each or $250k. You and your wife's amounts may be different.

We have 3 policies on my wife and I in this ladder style. The 10 year is about to be done.
Last edited by bloom2708 on Tue Dec 05, 2017 5:37 pm, edited 1 time in total.
"We are here not to please but to provoke thoughtfulness" Unknown Boglehead

gclancer
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Re: Seeking term life insurance recommendation

Post by gclancer » Tue Dec 05, 2017 5:24 pm

You didn’t ask, but you can compare price quotes/find policies to research further here: https://www.term4sale.com

The cheapest/best policy for me was actually through Costco (Protective Life) but I only needed a 20 year term (they only offer 10 and 20 year policies - but you could ladder them as suggested above).

Benton Bair
Posts: 83
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Re: Seeking term life insurance recommendation

Post by Benton Bair » Wed Dec 06, 2017 9:56 pm

gclancer wrote:
Tue Dec 05, 2017 5:24 pm
You didn’t ask, but you can compare price quotes/find policies to research further here: https://www.term4sale.com

The cheapest/best policy for me was actually through Costco (Protective Life) but I only needed a 20 year term (they only offer 10 and 20 year policies - but you could ladder them as suggested above).
Did you choose the additional benefit features like waiver of premium if disabled, accelerated benefit, chronic care and critical care? What choices do you have if 20 years from now you or your beneficiary decide insurance is needed for a longer time?

technovelist
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Re: Seeking term life insurance recommendation

Post by technovelist » Wed Dec 06, 2017 10:25 pm

Benton Bair wrote:
Wed Dec 06, 2017 9:56 pm
gclancer wrote:
Tue Dec 05, 2017 5:24 pm
You didn’t ask, but you can compare price quotes/find policies to research further here: https://www.term4sale.com

The cheapest/best policy for me was actually through Costco (Protective Life) but I only needed a 20 year term (they only offer 10 and 20 year policies - but you could ladder them as suggested above).
Did you choose the additional benefit features like waiver of premium if disabled, accelerated benefit, chronic care and critical care? What choices do you have if 20 years from now you or your beneficiary decide insurance is needed for a longer time?
Yes, that is the big argument for having at least some of your term coverage for as long a term as feasible (usually 30 years if you are under 55, then maybe 20 years until 65). You can always drop it if you don't need it, but if you do need it, it might be too late to add more coverage.
In theory, theory and practice are identical. In practice, they often differ.

gclancer
Posts: 434
Joined: Sat Apr 27, 2013 10:34 am

Re: Seeking term life insurance recommendation

Post by gclancer » Thu Dec 07, 2017 7:13 pm

Benton Bair wrote:
Wed Dec 06, 2017 9:56 pm
gclancer wrote:
Tue Dec 05, 2017 5:24 pm
You didn’t ask, but you can compare price quotes/find policies to research further here: https://www.term4sale.com

The cheapest/best policy for me was actually through Costco (Protective Life) but I only needed a 20 year term (they only offer 10 and 20 year policies - but you could ladder them as suggested above).
Did you choose the additional benefit features like waiver of premium if disabled, accelerated benefit, chronic care and critical care? What choices do you have if 20 years from now you or your beneficiary decide insurance is needed for a longer time?
It’s actually a Universal Life policy designed to be like term in that the premiums are lowest in the market for 10 and 20 year term (the two options) and no cash value accrues. At the end of the term you can pay a higher premium and keep the benefit the same or pay the same premium for a lower death benefit. Obviously all of this requires research on your part - due to facts unique to my personal situation, I will no longer need life insurance in 20 years so I’m not concerned about it. If you are concerned consider laddering a 30 year term policy with the 20 and 10 year term policies thru Protective/Costco. Would probably give you the most flexibility/bang for your buck.

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