$200-265/mo is cheapest life insurance

[Deleted]

A million dollar policy seems super high to me, but we live in a lower COL area, so maybe that is why. We only have 200K on each other.

[mrs.spunky]

Aug 15, 2012 13:40:32 GMT -5 @mjmksb04 said:

A million dollar policy seems super high to me, but we live in a lower COL area, so maybe that is why. We only have 200K on each other.

10x each person's income is recommended.

People need to think about:
-Lost income due to the other partner's death. One thing to consider is their inability to contribute to retirement. For instance, I don't have an employer-sponsored retirement plan. $5k/year in a Roth would not be enough for me to retire on if my husband died before he was 50.
-Paying off their house if both incomes are needed to support the household. You can easily say you will sell the house if something happens to your spouse, but it in this market that would be difficult.
-Paying bills during an extended LOA from their job following the death of a spouse. Can you imagine going back to work a week after your spouse passes? I don't think so.
-College costs for kids, if you have them and plan on helping them. Can you continue to do this if you are already working with only one income?

[badtzmaru22]

We only have a small policy on DH through his work. No one will cover him on a private policy because of some health issues. It sucks, but oh well. If something happens to him, I'll probably be too depressed to do anything but move back in with my parents anyway.

[liveintheville]

Aug 15, 2012 13:48:44 GMT -5 mrs.spunky said:

People need to think about:
-$5k/year in a Roth would not be enough for me to retire on if my husband died before he was 50.

-Paying off their house if both incomes are needed to support the household. You can easily say you will sell the house if something happens to your spouse, but it in this market that would be difficult.

-College costs for kids, if you have them and plan on helping them. Can you continue to do this if you are already working with only one income?

These are why we're supposed to have 1.6mil But that ain't happening.

Ok I'll stop whining. 1mil @ $200/mo it is.

Oh and good tip on the paying annually thing! Thanks, Minzy!

[mrs.spunky]

Aug 15, 2012 13:57:29 GMT -5 liveintheville said:

Aug 15, 2012 13:48:44 GMT -5 mrs.spunky said:

People need to think about:
-$5k/year in a Roth would not be enough for me to retire on if my husband died before he was 50.

-Paying off their house if both incomes are needed to support the household. You can easily say you will sell the house if something happens to your spouse, but it in this market that would be difficult.

-College costs for kids, if you have them and plan on helping them. Can you continue to do this if you are already working with only one income?

These are why we're supposed to have 1.6mil But that ain't happening.

Ok I'll stop whining. 1mil @ $200/mo it is.

Oh and good tip on the paying annually thing! Thanks, Minzy!

I think you will be fine on 1MM.

You only have 2-3 more years til the kids are in school F/T, right?

Even though you guys love Tony, you could probably get someone for less $$ if it is only a few hours per day from the time school lets out til when your DH gets home.

While it is a consideration if your DH died tomorrow, it is a cost that will diminish in a relatively short period.

[liveintheville]

Aug 15, 2012 14:07:37 GMT -5 mrs.spunky said:

Aug 15, 2012 13:57:29 GMT -5 liveintheville said:

These are why we're supposed to have 1.6mil But that ain't happening.

Ok I'll stop whining. 1mil @ $200/mo it is.

Oh and good tip on the paying annually thing! Thanks, Minzy!

I think you will be fine on 1MM.

You only have 2-3 more years til the kids are in school F/T, right?

Even though you guys love Tony, you could probably get someone for less $$ if it is only a few hours per day from the time school lets out til when your DH gets home.

While it is a consideration if your DH died tomorrow, it is a cost that will diminish in a relatively short period.

Tony might leave us as early as Jan 2013 :-( The longest he'll be with us is Aug 2013.

But yeah, Kid 1 will be in Kindergarten next year so we'll manage without him. We just don't want to. (He wall mounted our tv for us yesterday and rewired the stereo and basically organized our cables!)

[mrs.spunky]

That is so soon! Poor 'ville family!

[80sjunkie]

That stinks, I'm sorry. I wonder if it might make sense to supplement with other kinds of insurance. For example, insurance that pays off your mortgage or death benefits on car insurance in the event of a car accident. For most people (those with no pre-existing conditions) these don't normally make sense because they typically do not require health screenings so the premiums are a bit higher than you could get elsewhere. My guess is that isn't the case for your family.

[aurora]

Aug 15, 2012 13:18:32 GMT -5 chessie said:

Aug 15, 2012 12:53:01 GMT -5 liveintheville said:

Interesting. Can I ask what your rationale (for the rainbow) is? Do you both work? Any kids?
The kids are what's really pushing us to pull the trigger. And the fact that his new job only does 1x salary.

I used to think I didn't need an outside policy from our work, but after a death in the family that left lots of medical bills and funeral expenses, writing was on the wall. Its not just the everyday expenses, because I am not concerned with that either, its getting over that hump, paying for the final expenses and moving on. FOr some people there is only a small window you will even get insured for a cheap enough price too.

Honest question from someone who has chosen not to have LI (outside of work) because we have no kids, good savings, and could both afford all of our bills without the other: what caused such high "getting over the hump" expenses? Was the health insurance coverage inadequate or did it lack an annual out-of-pocket maximum? Were funeral costs more than usual? Were there other extenuating circumstances?

Personally, situations requiring long-term care frighten me a lot more than death when it comes to being uninsured or underinsured.

[Deleted]

I'm not at all surprised. My Dad is T1 diabetic and my mom mentioned that he has very little life insurance because he couldn't get it after he was diagnosed (in his mid 20s). I do think you need to do it.

[Deleted]

We pay $750/mo each for $1M whole life. #couldbeworse

[kimibrighteyes]

Aug 15, 2012 20:00:41 GMT -5 suzubell said:

Aug 15, 2012 19:45:18 GMT -5 @envinoveritas said:

We pay $750/mo each for $1M whole life. #couldbeworse

Whaaaaaaaaaaaaaaaaaat? I think my heart actually stopped. Why whole life instead of term?

Are you doing this for the insurance, as a tax shelter or as part of estate planning. How long do you have to keep paying this until the income from the investment portion is enough to pay for the insurance premium

[Deleted]

Aug 15, 2012 20:49:09 GMT -5 kimibrighteyes said:

Aug 15, 2012 20:00:41 GMT -5 suzubell said:

Whaaaaaaaaaaaaaaaaaat? I think my heart actually stopped. Why whole life instead of term?

Are you doing this for the insurance, as a tax shelter or as part of estate planning. How long do you have to keep paying this until the income from the investment portion is enough to pay for the insurance premium

Tax shelter - we make too much for ROTHs. Still not sure it's a wise investment but in too deep now.

[heygrey]

Aug 15, 2012 18:52:53 GMT -5 BirdGirl said:

I'm not at all surprised. My Dad is T1 diabetic and my mom mentioned that he has very little life insurance because he couldn't get it after he was diagnosed (in his mid 20s). I do think you need to do it.

+1 word for word.

i asked my mom about their life insurance situation and she has good coverage, but she's also in really good health. my dad is in good health considering he has type 1, but LI for him is INSANE. they looked recently since he just turned 55 and now qualifies for some of the senior plans.... it was upwards of $800/month. that is almost a quarter of their income.


also, i'm oddly excited to find another person diagnosed with type 1 in their 20s. my parents have had so many people argue with them (and i've had a few) claiming they don't know what they are talking about and it has to be type 2 because he was "so old". uh, no. it's not as common, but it definitely happens.

[kimibrighteyes]

Aug 15, 2012 21:09:15 GMT -5 @envinoveritas said:

Aug 15, 2012 20:49:09 GMT -5 kimibrighteyes said:

Are you doing this for the insurance, as a tax shelter or as part of estate planning. How long do you have to keep paying this until the income from the investment portion is enough to pay for the insurance premium

Tax shelter - we make too much for ROTHs. Still not sure it's a wise investment but in too deep now.

How much of this cost is insurance premiums and how much is investment?

[MixedBerryJam]

Is this for you or your husband? Not be morbid or anything but I wouldn't get life insurance on someone who didn't work.[/quote][/i]

This could not be wronger. How will the surviving spouse pay for all the services the sahp provides? What about funeral expenses? What abouttime the surviving spouse needs to take away from work for child-related issues.

[Deleted]

Aug 15, 2012 21:22:27 GMT -5 heygrey said:

Aug 15, 2012 18:52:53 GMT -5 BirdGirl said:

I'm not at all surprised. My Dad is T1 diabetic and my mom mentioned that he has very little life insurance because he couldn't get it after he was diagnosed (in his mid 20s). I do think you need to do it.

+1 word for word.

i asked my mom about their life insurance situation and she has good coverage, but she's also in really good health. my dad is in good health considering he has type 1, but LI for him is INSANE. they looked recently since he just turned 55 and now qualifies for some of the senior plans.... it was upwards of $800/month. that is almost a quarter of their income.


also, i'm oddly excited to find another person diagnosed with type 1 in their 20s. my parents have had so many people argue with them (and i've had a few) claiming they don't know what they are talking about and it has to be type 2 because he was "so old". uh, no. it's not as common, but it definitely happens.

My Dad says the military saved his life. He was diagnosed at basic training when he was drafted to Vietnam. If he had been sent over he likely wouldn't have lived (because they would have had no way to treat him in Vietnam).

[Deleted]

Aug 15, 2012 21:23:11 GMT -5 kimibrighteyes said:

Aug 15, 2012 21:09:15 GMT -5 @envinoveritas said:

Tax shelter - we make too much for ROTHs. Still not sure it's a wise investment but in too deep now.

How much of this cost is insurance premiums and how much is investment?

Ummm... I don't know. How do I figure this out?

[kimibrighteyes]

Aug 15, 2012 21:46:38 GMT -5 @envinoveritas said:

Aug 15, 2012 21:23:11 GMT -5 kimibrighteyes said:

How much of this cost is insurance premiums and how much is investment?

Ummm... I don't know. How do I figure this out?

Hmmm. I have just looked this up and it may not be transparent with whole life. I have universal life insurance which is similar in some ways to whole but the cost of the insurance premiums is listed on my statement. Wikipedia explains the differences if you look up universal life insurance

I am not sure that the universal life is a great investment but it is also a tax shelter for us. As well since we were older when we had our kids, i wanted to make sure they were left something. It is also part of our estate planning. The policies on DH and I will be fully paid once we are about 50 and we won't have to contribute any more after that point unless we want to for tax purposes

[Deleted]

Aug 15, 2012 21:27:03 GMT -5 MixedBerryJam said:

Is this for you or your husband? Not be morbid or anything but I wouldn't get life insurance on someone who didn't work.

[/i]

This could not be wronger. How will the surviving spouse pay for all the services the sahp provides? What about funeral expenses? What abouttime the surviving spouse needs to take away from work for child-related issues.[/quote]

Again, not generalizing in my prior post but talking about liveintheville's specific situation. She does not work but is also not the full daytime care provider for her family as she has a disability. She has a nanny (read above). Funerals are expensive to be sure but they do not require a $1m policy,

Sorry I just wanted to reiterate that I'm not saying SAHMs don't need life insurance.

[Deleted]

Aug 15, 2012 10:47:22 GMT -5 kooshball said:

Aug 15, 2012 10:44:16 GMT -5 mrs.spunky said:

Employer coverage usually isn't portable. If he went to another employer that didn't have LI or had a low limit and no buy-ups, he'd be SOL then too.

Of course... ?! I know he'll stay at a single job for years when he gets settled.

And what if he gets laid off? Or has a long term illness that means he loses his job and they don't pay out life insurance? There are all kinds of circumstances (beyond my two off the top of my head examples) for why ONLY employer life insurance is risky. It's fine if you are willing and able to gamble, but I don't think that's a good thing for most people to do.

DH and I each have 150k of LI - we pay $47 a month combined. With that, I'd say $200 a month for 1 million, especially with health issues (we don't have anything other than a few common family history things) is actually not horrible.

We have such a "low" amount because that's what our house is worth and we have no kids, so if someone died the other could pay off the house or other debts, pay for funeral/burial/loose ends, and move on. I think we're too young and too unattached to long term expenses to worry about covering the other long term. I assume if DH died I'd remarry eventually and vice versa so there is no need for long term income replacement. Or at least not enough of a need to justify a higher monthly payment right now.

[mrs.spunky]

Envino, call the insurance company and ask them what the cash value is. Ask them to send you a copy of the what would show the cash value and death benefit. Also inquire regarding the death benefit if you suspended paying the premium now. You will also want to ask about the performance of the investments.

[brit1017]

I work with a girl with T1 diabetes- she recently told me that she had gotten a quote for LI, and if I'm remembering correctly, it was somewhere in that ballpark.

[Deleted]

DH & Pay something like $370/mo for $1M for me and $2M for him for a 30 year term. We got it when DH was 37.

It was higher because of our age and I have asthma and DH has really high cholesterol.

I don't think your quote is way off because your DH has Type 1.

The piece of mind I get from knowing we have coverage is priceless.