22 Y/O hoping to get term and whole

[jsc2009]

22 Y/O F non-tobacco.

I’d assume I’m able to have 2 types of life policies. I’d be getting a Return of Premium 30 term (100k death benefit and ROP of ~20k at age 52 if I don’t die) and a Whole Life policy for 50k. I want to to get both because I have a daughter and I’d be able to basically get my premiums back(term) and then still be covered with my whole If something happens to me when that policy is over. I have a daughter and I just want to make sure she’s good if I die. Plus wouldn’t it be a win to come into 20k a couple years before retirement?? Does this sound reasonable? Wwyd?

 

[tabinek]

@jsc2009 If ROP term hasn’t been repriced in the past 12 months it is going to be a bad deal. The interest rate environments have changed too fast for the pricing on ROP term to keep up.

 

[thejollygreengiant]

@jsc2009 100% would recommend IUL -cash accumulating permanent product with an increasing death benefit. Has to be set up right and max funded to premium guideline. You’re at the perfect age.

 

[lovemeformexo]

@thejollygreengiant I completely agree with southern_access

 

[saren911]

@thejollygreengiant

ere you I'd invest into a bigger whole life policy and forget about the term. I say this because if you're only 22 then you'll actually make a profit off of the cash value the policy accumulates and you can usually do what is called a paid up policy. For example the company I work for has a policy for 120,000 dollars and by the time you retire you can do the Reduced paid up option where you take a little bit of reduced coverage but never pay for it again. In your case it would be close to 103,000. You could also get the premiums you paid into the policy back plus 12,000 if you take your cash value and even then you'll still have coverage

As a licensed agent, I second that as well. It's all context-dependent but it does sound like IUL may fit well to your need.

 

[jsc2009]

@saren911 This is all so confusing.

 

[saren911]

@jsc2009 Feel free to DM me. Happy to help.

 

[structure]

@jsc2009 As an agent and as a father. Max out on a term policy. ROP is just adding to the premium, so I avoid that. If healthy, 500K to $1 million dollar term for 30 years should he less than $30 a month. I’ll rather make sure my kids get a big payout then putting money into a Whole Life policy at your age.

Been an agent for 20 years and I sell plenty of VULs and IULs. If you were sitting in front of me right now, I would tell you buy a big term and invest the difference in your 401K or Roth. The returns will always be higher there.

 

[jsc2009]

@structure Can i pm you?

 

[structure]

@jsc2009 Sure. I can answer any related questions you may have.

 

[jsc2009]

@structure Sent!

 

[kayla701]

@structure This. As an agent as well it is much better to invest, the only issue is guarantee, if you’re not smart while investing you’ll lose more than a WL or you might not gain enough to outcompete a WL, or you could die before your investments outcompete a WL

 

[scenematt]

@structure Ah, someone finally speaking some truth into this young adult!

 

[ellemess]

@jsc2009 Ms. 22y/o non-tobacco: while trying to find out what the best solution for you is, I recommend you speak to a licensed agent about your needs/goals regarding the policy. One type of policy isn’t necessarily better than the other. Each have a specific function and serves different purposes. Did you know most life insurance companies offer something called living benefits? You don’t need to die to utilize the death benefit proceeds. This feature is usually included at no extra charge to a life insurance policy and just adds an extra layer of financial protection.

 

[thegodwhisperer]

@jsc2009 So I'm actually a licensed agent. If I were you I'd invest into a bigger whole life policy and forget about the term. I say this because if you're only 22 then you'll actually make a profit off of the cash value the policy accumulates and you can usually do what is called a paid up policy. For example the company I work for has a policy for 120,000 dollars and by the time you retire you can do the Reduced paid up option where you take a little bit of reduced coverage but never pay for it again. In your case it would be close to 103,000. You could also get the premiums you paid into the policy back plus 12,000 if you take your cash value and even then you'll still have coverage

 

[jsc2009]

@thegodwhisperer let’s say I got this policy and did exactly this. How much do you think my beneficiary would get if I did happen to die?

 

[thegodwhisperer]

@jsc2009 If you died while you were paying on it then 120,000.
If you died after you took the reduced paid up then they'd still be guaranteed the 103,000 that you weren't paying for.
And it doesn't have to be 120,000 you can get as much coverage as you want depending on how much you're willing to pay and it's guaranteed to pay out to your beneficiary.

 

[jeshurun1111]

@thegodwhisperer OP has a kid and you’re advising them underbuy on overall death benefit?

 

[thegodwhisperer]

@jeshurun1111 No I advised her not to waste money on a term if she's trying to leave money to that kid. Yes it's a 100k death benefit but it only lasts 30 years. Yeah they're giving her her money back at the end but if you do the math she actually ends up losing 1000 bucks. While on the other hand if she just buys more of a whole life policy that money is guaranteed to pay out no matter how long she lives and she can stop paying for it by the time she retires and still have coverage. Plus if she renews that term then the price just goes up to match her current age/health.

 

[jeshurun1111]

@thegodwhisperer Term is for temporary needs, like when your kid is young and your mortgage balance is high. Whole is for permanent needs like final expenses and legacy. Neither is bad. The most important number for OP to look at is death benefit needed right now, everything else is a secondary concern. Since they have a dependent, that amount is high. If they can’t afford that amount in whole, then term is not a waste.

Are you going to come up with the difference if they pass soon? Didn’t think so.