Posted: 6/18/2002 8:46:51 PM EDT
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Do you folks have any particularly good places to start? I have some from my employer, but I really want (a lot) more to help my kids out if something happens to me. FWIW: age 30, not at all overweight, non smoker, rarely drink. Any suggestions? Thanks in advance! Eric |
| For a temporary need (children at present to adulthood) you would be well served by term insurance. There are basically two types--decreasing and level, in varying lengths. The decreasing type does what the names implies--the amount payable at death (face amount) goes down each year, as your children get closer to being grown. This type is also used for covering home mortgages. Typical term periods are either 15 or 30 years. The other type stays level for commonly 5, 7, 10, or even 20 years. Make sure you get a policy that is guaranteed renewable at the end of the term period, and is guaranteed convertible to a permanent (whole life or variation) throughout its life, should you desire to switch to a permanent plan later. This avoids having to re-qualify health-wise should you develop prohibitive health problems. Typical amounts are 6-8 times your annual income. Term insurance is cheap, especially as you fit exactly the profile of who companies wish to insure--young, healthy, non smoker. You can get a rider for your kids also for less than $5.00/mo. that is convertible at their adulthood also, and covers all children, future step-children, future adopted children, future born-to-you children--all for the same $5.00. People only buy life insurance because they care about someone else--rarely for selfish reasons. Your children are lucky. Best wishes. |
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I second the motion for term insurance. Usually 8 - 10 times your income (depends on other assets, etc.). That way, the surviving spouse can invest the money in a good mutual fund (average return 12%) and live off the interest without touching the principal. I'd suggest a good independant agent, one who represents many companies. If you go to an Allstate agent, guess what product you will buy?! An insurance salesman will try to talk you into whole life, variable life, or some such permutation. DON'T BUY IT!! The insurance costs are many times the costs of term and the "investment" options are usually not very good. The death benefit is reduced by the cash value of the policy and they charge you interest if you borrow your own money. Zander insurance "www.zanderins.com" deals with about 300 different companies and will get you the best rate possible. I'd go for a 20 or 30 year LEVEL term. Bill |
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Quoted: Thanks Beekeeper! I am pretty ignorant to the whole aspect & variations of Life Insurance, and your post was a big help! Are there any notable companies that I should look in to? (no clue on my end) Thanks again! Eric Call an independant insurance agent in your area. Since he/she's "independant", they can shop many different company's policies past you to see what fits you best. By all means, stick to term policies. |