sorry to interject but i am a financial advisor for massmutual so i will not really go into to much... but if he does get (WHOLE LIFE) insurance then two things will happen one he will guarantee his insurability because you would not belive the amount of cases we get of kids who are 18-25 that want to get insurance but they developed health problems.... if you are healthy then go for it.... also WHOLE LIFE will get you a cash value that you can then take loans against for yourself.... such as buying a car... alot of my cilents do that because it is a private and interest free loan... also if you keep your policy till you retire you can then draw off of it a tax free income for a set number of years depending on how much you have.... again this is for WHOLE LIFE... NOT TERM INSURANCE..... Term insurance has its place but for the most part is a rip off.... but if you go through a company like MASSMUTUAL or any other AAA rated company then you can always convert to WHOLE LIFE after.... so now im sure i will get flamed on,because of the recent whole life is a ripoff that has been in the media.... but again it all depends on the company that writes it.... you get what you pay for.... just for instance MASSMUTUAL has been paying roughly 7% dividens on it whole life policies not bad for both an investment and some protection that way you get the best of both worlds.....
Ah, good an insurance salesman. How convenient. I have questions. For personal reasons, I would like to take out a term life insurance policy on my parents. What sort of information would I need to arrange this? How much cooperation from my parents would I need to get the insurance?
You need to be careful about making sure there aren't any incidents of ownership regarding your parents and that policy should you decide to get it. If there are any incidents of ownership then the death benefit will be included in their estate and subject to estate taxes.
One way to get around this is to use an Irrevocable Life Insurance Trust (ILIT, sometimes called a gift trust). If your parents want to fund it they still can without incidents of ownership provided they do it properly by using their annual gift exemption ($12,000 this year). You should use a corporate trustee.
And about whole life, check out universal life instead.
I'll stop writing for now
Originally posted by: everman
You need to be careful about making sure there aren't any incidents of ownership regarding your parents and that policy should you decide to get it. If there are any incidents of ownership then the death benefit will be included in their estate and subject to estate taxes.
One way to get around this is to use an Irrevocable Life Insurance Trust (ILIT, sometimes called a gift trust). If your parents want to fund it they still can without incidents of ownership provided they do it properly by using their annual gift exemption ($12,000 this year). You should use a corporate trustee.
And about whole life, check out universal life instead.
I'll stop writing for now
Well, I want to get the insurance on them to protect myself from any unexpected expenses when they die, not to mention make sure my sister has a little something to help her out later when she's old enough for college. I'd be paying for the policy and would rather they not know about it since they might take it the wrong way or they might start bugging me to give them money more than usual if they knew I had extra money each month to be paying into a life insurance policy.
By the way to the OP, it's just my opinion, but you say you have no family so it doesn't matter, but the fact is if you were to die, your parents would have to take care of your funeral expenses or leave your corpse at the morgue. Do them a favor and get enough insurance at least to cover your funeral expenses.
It's true, the rates on my term life policy went up by over $250 a month after I filed a claim.Originally posted by: kranky
I think he was saying that if you make a claim on a life insurance policy, they will charge much more for the next one.
Originally posted by: DaveSimmons
It's true, the rates on my term life policy went up by over $250 a month after I filed a claim.Originally posted by: kranky
I think he was saying that if you make a claim on a life insurance policy, they will charge much more for the next one.
That's odd, seeing that you can't really die when you're already dead, it should have been cheaper!
I have life insurance and disability. If I'm ever unable to work I collect a large amount of tax-free income every month. If I die, my beneficiaries collect a large sum of money.
There's another aspect of life insurance that people are missing entirely. For many people, especially the self-employed, the policy has the ability to reduce total tax liability through contributions made to the policy. You pay a fee of course, but over the long-term the tax deduction far, far offsets the cost.
There's another aspect of life insurance that people are missing entirely. For many people, especially the self-employed, the policy has the ability to reduce total tax liability through contributions made to the policy. You pay a fee of course, but over the long-term the tax deduction far, far offsets the cost.
rocadelpunk
Diamond Member
- Jul 23, 2001
- 5,589
- 1
- 81
i think your dad is going to off you :0.
No need for insurance at your age, unless you are really really reckless.
No need for insurance at your age, unless you are really really reckless.
Indeed. As part of a comprehensive financial strategy it can work out very beneficially. It's obviously not for everyone, but for me it's been great.
DrPizza
Administrator Elite Member Goat Whisperer
Because he makes a higher commission when he sells whole life insurance
They have all sorts of gimmicks to make it more appealing - you can loan money to yourself, etc. I have never heard a true financial advisor give such advice - only insurance salesmen who prefer the title of "financial advisor." Essentially, whole life policies are no different than purchasing a term policy and investing the difference. Except that with the whole life policies, your options are quite limited as far as the investing goes.
Here's some advice coming from a person who has nothing to gain by convincing people to buy one type of insurance vs. another type: As stated by multiple people above, there's a time for life insurance. And, you select the amount of life insurance based on the needs of the family you'll leave behind. But, you buy term life insurance. You *this is the important part* also invest a portion of your income. By the time you're 65 and term life policies have become expensive, you should be ready to retire with few debts, and plenty of money in the bank to cover final expenses, etc. Thus, you should no longer need life insurance at that age.
Think about it for a moment. Look at those nice tall shiny new buildings the insurance companies are building. The more money you're giving them (and whole life is more expensive than term), the more money they're going to make from you. They're not in the insurance business merely to provide a service to you... they're out to make a profit. Personally, I think you can do better buy shopping around, rather than being forced to purchase your life insurance policy and do your investing through the same vehicle.
Sure you can do that and pay for it yourself, no problem. However insurance companies don't want to insure people who will die next week, so they will need to know some things about your parents. I don't think you can get around them knowing about it.
If you want a cheaper option and don't mind waiting until they both die, you can purchase a second to die policy which will pay the death benefit after they are both gone. It's cheaper because it's based on both of their life expectancies.
judasmachine
Diamond Member
- Sep 15, 2002
- 8,515
- 3
- 81
DrPizza
Administrator Elite Member Goat Whisperer
BUT, if you have the money to pay for life insurance now, you should already be starting on investing.
Please explain how term insurance is "for the most part a rip off".
This ought to be good.[/quote]
Because he makes a higher commission when he sells whole life insurance
They have all sorts of gimmicks to make it more appealing - you can loan money to yourself, etc. I have never heard a true financial advisor give such advice - only insurance salesmen who prefer the title of "financial advisor." Essentially, whole life policies are no different than purchasing a term policy and investing the difference. Except that with the whole life policies, your options are quite limited as far as the investing goes.
Here's some advice coming from a person who has nothing to gain by convincing people to buy one type of insurance vs. another type: As stated by multiple people above, there's a time for life insurance. And, you select the amount of life insurance based on the needs of the family you'll leave behind. But, you buy term life insurance. You *this is the important part* also invest a portion of your income. By the time you're 65 and term life policies have become expensive, you should be ready to retire with few debts, and plenty of money in the bank to cover final expenses, etc. Thus, you should no longer need life insurance at that age.
Think about it for a moment. Look at those nice tall shiny new buildings the insurance companies are building. The more money you're giving them (and whole life is more expensive than term), the more money they're going to make from you. They're not in the insurance business merely to provide a service to you... they're out to make a profit. Personally, I think you can do better buy shopping around, rather than being forced to purchase your life insurance policy and do your investing through the same vehicle.[/quote]
ok well i was going to stop but i guess some people are just uninformed....
there are three ways you can get your info
1. experience-which i do everyday
2.hearsay-what is popular in the news right now(buy term invest the rest)
3.an article-usually in a magazine that was paid to write that article
so how is term a rip off... well your paying for something they is a temporary service kind of like cell phone service or cable tv... it has its place like i said.... but at the end of the day you have no cash value and also you get no dividens(return on your money) ... also if you have any problem with these (insurance sales people) that you hear so much about file a complaint if they did any wrong doing and get their license stripped let the courts decide... I have my CFP and i actually dont sell to much life insurance I sell annuities they are a great investment... but like i said people now adays are on that slogan buy term invest the rest cause we are still in a bear market and this always comes up when we are in a bear market(for obvious reasons) ALSO WHAT DO I HAVE TO GAIN ON THIS FORUM BY TELLING YOU TO BUY (WHOLE LIFE) I HAVE NEVER AND PROBABLY WILL NEVER MEET ANY OF YOU SO I WILL NOT BE SELLING YOU ANYTHING... i LOVE PEOPLE WHO READ MONEY MAGAZINE AND WATCH CNN AND THINK THEY KNOW WHAT THEY ARE TALKING ABOUT... THESE ARE THE SAME PEOPLE I SEE WHEN THEY SHOULD BE RETIRED WORKING AT THE LOCAL SUPERMARKET AND WALMART... NOT CAUSE THEY WANT TO WORK ITS CAUSE THEY HAVE TO WORK
Life insurance is a joke. Especially for healthy 18 yr old. The only type policy you should consider is a term life policy that would pay for your funeral if you died.
BTW, your dad is a freak for suggesting that you have a life insurance policy.
BTW, your dad is a freak for suggesting that you have a life insurance policy.
All I can offer is this- If you get life insurance you better hide from your dad so no "unfortunate" accidents take place".
Life insurance at 18. Never heard of such a thing...
Life insurance at 18. Never heard of such a thing...
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