Life Insurance -cash value for college

[divanerd]

Ladies is whole life or universal life a good policy to have if I want to use some of the cash value to pay for child's college?

We already have a good 529 and savings.
Anyone done this..

[turkletsmom]

From what I've read/heard, whole life is not a good investment vehicle. The best life insurance is a term policy for 20 or 30 yrs, etc that you can usually get pretty cheap. You might spend several hundred dollars a month on whole life. You're better off getting term for LI and then just investing what you would have spent on WL in a brokerage account.
Years ago I used to follow Dave Ramsey's plans (Ugh I know) and he has a LOT to say on why whole life is bad to invest in.

[sandandsea]

My grandma (unbeknownst to anyone) bought the Gerber whole life policy when I was a baby and gave it to me after college. I cashed it in and got approximately $300. I don’t know how much she paid over the 20ish years but I’m guessing it was more than $300.

[sadlebred]

Nope, you are better off putting more money in the 529 or a money market, savings account, or regular investment account.

clark.com/insurance/life-insurance/term-life-vs-whole-life-insurance/

[ohgillian]

I don't know much about this, and we personally first funded a 529, then put additional funds into our retirement that are earmarked for college.

That said, in some circumstances there can be benefits to the life insurance approach, primarily that the funds don't have to be used for education. Here's an article that compares the 529 vs life insurance for college: www.investopedia.com/articles/personal-finance/102915/life-insurance-vs-529.asp