Life insurance

[TCRAIG]

I just did a fast run on an online "get life insurance quotes, nobody turned down, no medical exam' source. I am 68 and healthy, never had any serious medical issues, non-smoker. $40K of whole life insurance was quoted at about $385 a month. Nope, I'd rather sock the money away on my own. They do suck you in though, advertising as $10 a month, premiums never increase, you can't be turned down!

Don’t do whole life - it’s a complete waste.

 

[tvguy]

There are some other older threads that talk about 'long term care insurance'. Most are WAY more expensive than life insurance, might be something you never need to use and exactly what costs they cover makes a huge difference if it would ever be worth it for you. No one should ever assume it will cover all of your costs for staying in a nursing home because most do not.

You do have to do your homework. And as with ALL insurance, it is something you may never use. My mom had homeowners insurance for 63 years and never used. She had flood insurance and never used it. She didn't start driving until after I was born, but had auto insurance for 56 years and never had a claim. The ONLY insurance she ever used was Health Insurance and Long Term Care Insurance. She needed Long Term Care for 13 months in 2012-13. Her care home cost $3,200 a month. Her Long Term Care insurance paid $2,700 a month. So not all, but a HUGE help.
There are many options for what kind of coverage you have. Her plan had a lifetime cap of $300,000
My wife and I picked a plan with a fixed benefit of $6,000 a month each, with a 5% step up every year for inflation. Had it 15 years, but I figure the monthly benefit now will be just over $10,000 a month each. No dollar cap, but it will pay for up to 5 years care each.
My brother and his wife have no Long Term Care insurance, but their plan is to sell their house or get a reverse mortgage if they ever need long term care.

 

[mjkacmom]

I just did a fast run on an online "get life insurance quotes, nobody turned down, no medical exam' source. I am 68 and healthy, never had any serious medical issues, non-smoker. $40K of whole life insurance was quoted at about $385 a month. Nope, I'd rather sock the money away on my own. They do suck you in though, advertising as $10 a month, premiums never increase, you can't be turned down!

We don’t do whole life here. The reason no one gets turned down for medical reasons is that the costs are very high. I believe it takes years for the insurance to be active.

 

[mjkacmom]

You do have to do your homework. And as with ALL insurance, it is something you may never use. My mom had homeowners insurance for 63 years and never used. She had flood insurance and never used it. She didn't start driving until after I was born, but had auto insurance for 56 years and never had a claim. The ONLY insurance she ever used was Health Insurance and Long Term Care Insurance. She needed Long Term Care for 13 months in 2012-13. Her care home cost $3,200 a month. Her Long Term Care insurance paid $2,700 a month. So not all, but a HUGE help.
There are many options for what kind of coverage you have. Her plan had a lifetime cap of $300,000
My wife and I picked a plan with a fixed benefit of $6,000 a month each, with a 5% step up every year for inflation. Had it 15 years, but I figure the monthly benefit now will be just over $10,000 a month each. No dollar cap, but it will pay for up to 5 years care each.
My brother and his wife have no Long Term Care insurance, but their plan is to sell their house or get a reverse mortgage if they ever need long term care.

MIL pays $10,000+ a month for assisted living (in NJ but in farmland), can’t imagine the cost if she moves into nursing care.

 

[tvguy]

MIL pays $10,000+ a month for assisted living (in NJ but in farmland), can’t imagine the cost if she moves into nursing care.

The price spread is amazing. When I priced care for my mom in 2012 the rates were $1,200 a month for those who qualified for Social Security payments for their care, to $8,000 for a Country Club type care facility. So my mom's facility, a Residencial Care Facility for the Elderly, which are popular in California with just 6 residents in a residential area, was a good compromise at $3,200 a month.
A popular option here are retirement villages that offer all levels of care from senior apartments to full time care. There is one near me with 800 residents The one time "buy in" is $295,000 and you move from one level of care to the next as need be. The average sales price of a home here is $520-$543,000 so many seniors sell their homes, use the money to buy into the care facility, bank $200,000 or so. That is the option my brother is looking at if he and his wife need care.

 

[Mackenzie Click-Mickelson]

You're looking way too late in life for life insurance. You should have gotten it many years ago. You're either going to be aged out meaning you're ineligible for coverage due to your age or it will be very cost prohibitive especially if you want higher amounts due to your age.

I've had a Universal Life IIRC policy since I was 18 (so for 18 years now) with Farmers. That one is only $85,000 so it's not very high and it's a little over $17 a month. When my husband and I got married 11 years ago we got life insurance policies on each other at $500,000 each, those are term 80 (meaning payout up to age 80) but can be converted to a different type of policy at any time and is our intention to do so down the line. The $500,000 (X2) is a little over $51 total a month for both of them. It started out in the low $40s when we were in our mid-20s; mine has been earning a small dividend for years (it usually is about $12 or so a year broken up over 12 months) and my husband's started earning dividends a few years back but about half as much as mine. The $500,000 policies also required medical exams due to the amount, it was really just blood work (done at our house), height and weight, blood pressure that minimal type stuff.

The main intention for us to give life insurance on each other is more for debt such as the mortgage and other expenses related to death or after effects from death (such as sudden loss of income). Ours is through Northwestern Mutual done through our financial advisor. While I personally agree it's still good advice to have life insurance for the big expenses should something happen you needed to have done this decades (and I truly mean decades) ago instead of getting it so late in life.

At your age IMO I would only look at life insurance for expenses related to a funeral and either for you or your spouse or your relatives. But even then it might better to set up a bank account that has survivor rights (for your spouse) or something similar (for your relatives) that allows for expenditures related to a funeral and quick access to the money. This also might be a good time to discuss what would happen if one of you passes with a mortgage still around though (it sounded like you would still have a mortgage but I didn't know if owning a house meant without a mortgage) as well as any applicable property taxes and homeowner's insurance.

 

[barkley]

Don’t do whole life - it’s a complete waste.

it's not for everyone but in some circumstances it can be an appropriate product and beneficial for the purpose the individual/couple has in mind.

MIL pays $10,000+ a month for assisted living (in NJ but in farmland)

there have been some news pieces in recent years in our area about how some who have ltc plans dating back may find that because of changing trends in elder care those ltc plans may not be as useful as they had planned for. one case that got allot of coverage was an elderly woman who had been able to stay in her private home (with familial support) until it just became too unsafe so she moved on to assisted living eventually needing to go into the highest level of assistance which of course comes with the highest cost. her family looked into using her long term care insurance b/c the services mentioned in the contract as being covered were what she was receiving. they were denied learning that the older policies have dated language that only permit payment if those services are in a designated 'nursing facility' (which most if not all assisted livings are not). the investigation brought up some interesting points about how assisted living places have taken on many of the tasks that used to force the elderly into nursing care so the average length of stay in nursing care places has decreased tremendously. allot of the senior advocacy groups were encouraging people to look at the wording on their policies to determine in what circumstances they could actually avail themselves of coverage (stuck with me b/c I've known more than one person who avoided nursing care by using assisted living coupled with hospice support).

 

[TCRAIG]

Long term Care insurance can be ‘tricky’…lots of times it only covers full time total care in a nursing home - nothing for home health or senior/assisted living no matter if it’s at home or in a care facility. I had a friend who had it and paid for decades, but it would NOT pay a dime when she had to move to a care facility because she was still mobile. Some also deny coverage for those with dementia since they only cover physical needs…you got to be careful, read the policy and do your research…

 

[jimmymc]

My question is how attached are you and your family to the house? If one of you were to pass away, would the other be comfortable downsizing into a cheaper or possibly no mortgage? And if you both passed away, would your family be Ok selling the house and splitting the remaining amount? I generally don't think people need it once their kids are independent, but if your current place still has a mortgage and is very important to you, that might be an exception.

 

[LuvOrlando]

20 year term is least expensive IMO, we started our 20 year plans with USAA when we were in our very late 20's and got a provision to extend another 20 years when that ended. I have policies for my kids that started though my policy that I pay that they can pick up with when they choose, for now I am ok with the under $20 a month to protect their future families. For us the concern was mostly to cover mortgage and our kids student loans while raising our families to not leave the other person struggling, it has covered the span so the plan was a good fit.

I believe AAA offers some to members that seems like a good deal.

I tried to look into long term insurance during Covid, whatever market was there seems gone now, maybe it will come back when there is more interest in higher risk investments.

Social Security Medicare is sort of a catastrophic plan for me at this point and I hope it is never ever necessary.

 

[tvguy]

You're looking way too late in life for life insurance. You should have gotten it many years ago.

Which is why it is very popular for parents (or Grandparents) to buy life insurance for newborns. It is supposed to guarantee acceptance later in life for a higher value life insurance policy. My wife and I both were born in 1957 and our parents bought us basic, $1,000 life insurance policies. Since then a big seller of life insurance for newborns is Gerber. The baby food company founded it's life insurance division in 1967.

 

[Mackenzie Click-Mickelson]

Which is why it is very popular for parents (or Grandparents) to buy life insurance for newborns. It is supposed to guarantee acceptance later in life for a higher value life insurance policy. My wife and I both were born in 1957 and our parents bought us basic, $1,000 life insurance policies. Since then a big seller of life insurance for newborns is Gerber. The baby food company founded it's life insurance division in 1967.

Juvenile policies have limitations to them and they also don't do any good if the parents cash them out such as what happened to my husband's policy when his parents ran into money issues and 17 years of paying for it went blip and he had no say in it since it was a juvenile policy not in his name. If you get it when you are 18 and pay for it you have the control over it.

Side note yes I'm sure we're all knowing of gerber.

 

[disneychrista]

Could your husband survive financially without your Social Security & pension (if applicable)? If so then you do not really need a life insurance policy. Same goes the other way could you survive financially without your husbands Social Security.

 

[mjkacmom]

Which is why it is very popular for parents (or Grandparents) to buy life insurance for newborns. It is supposed to guarantee acceptance later in life for a higher value life insurance policy. My wife and I both were born in 1957 and our parents bought us basic, $1,000 life insurance policies. Since then a big seller of life insurance for newborns is Gerber. The baby food company founded it's life insurance division in 1967.

And it’s not a great investment, I cashed out the policy my parents had for me for $5000, if only that was put somewhere else. My CFP husband would never buy a whole life policy for a child (or anyone really).

 

[tvguy]

And it’s not a great investment, I cashed out the policy my parents had for me for $5000, if only that was put somewhere else. My CFP husband would never buy a whole life policy for a child (or anyone really).

Insurance of any kind is never an investment. You are paying for protection in case of a catastrophe. I agree, I only buy term insurance, not whole life.

 

[HeatherC]

As you have discovered, life insurance is something you should have purchased and locked in a premium decades ago. My wife and I bought $500,000 coverage each when we were 29 when our first child was born. When our kids were through with College, we cut the insurance to $250,000 each. The premium is $123 a month for me, as I am male and a higher risk, and $50 for my wife. Even though we were only 29 when we bought it, we had to have an Insurance company Doctor do a physical and had to have blood work done to qualify. At this point we are keeping the coverage for one reason. When one of us passes, the idea is the life insurance payout will help ease the loss of the deceased spouses Social Security. We both started Social Security this year, and our Social Security is almost to the dollar equal to what we were bringing home working. We are not touching our retirement savings......IRAs that are 401k Rollovers. Of course, in 6 years we will HAVE to start minimum distributions when we turn 73, but it doesn't mean we have to spend what we take out, and I don't anticipate needing any of that money.
My mom dropped all her life insurance when I was out on my own. She instead purchased long term care insurance with that premium money. Long term care insurance is also something you should have and should have gotten years ago. My premium for that is about $2,500 a year each, so about $200 a month each. As a 67 year old, I did look at switching companies, but because of my age, buying a plan for us now would run about $7,000 a year each, over $500 a month each.

Is that term life? Aren’t most of them only good for 30 years max? That is what we have and ours will expire in a few years…even before we retire. But our kids are grown and mortgage will be done so won’t really need it anymore anyway.

 

[tvguy]

Is that term life? Aren’t most of them only good for 30 years max? That is what we have and ours will expire in a few years…even before we retire. But our kids are grown and mortgage will be done so won’t really need it anymore anyway.

I think it depends on the policy. Gerber Life offers both Whole Life and Term.

 

[Pooh2]

Has anyone ever had the Group Term Life Insurance through AAA? We get those invitations all the time.

We were curious about this as well but cannot bring ourselves to make the inquiry because it's hard to get them to stop calling!

 

[Mackenzie Click-Mickelson]

We were curious about this as well but cannot bring ourselves to make the inquiry because it's hard to get them to stop calling!

I don't mail out things too often but freely admit when the AAA Life Insurance packets that are for advertisements for add ons for AAA members come (which they mail them out frequently) I do like the return address labels they put inside ones, not every mailing has them but usually at least 2 or 3 times per year they do.

 

[Judique]

I don't mail out things too often but freely admit when the AAA Life Insurance packets that are for advertisements for add ons for AAA members come (which they mail them out frequently) I do like the return address labels they put inside ones, not every mailing has them but usually at least 2 or 3 times per year they do.

I like them also but have thrown so many out because I don't mail out very often. I also get them from a couple of other organizations that are hoping for a donation.