Should we stop paying for term life insurance?

[Anonymous]

Anonymous wrote:I was 23 when my dad died. My undergrad was paid off, but I was a grad student living across the country with a beater car and no real income. The life insurance is the single reason I have a stable life in my 30s. My mother kept the other money as she still likely had another 30-40 years to go. I’d keep paying it.

Yes, but OP has already fully funded college, and has $6 million on hand that could go to children, so the insurance policy is not needed.

OP, once you hit 20 years, let it lapse!

[Anonymous]

It’s basically pennies to pay at your net worth. Seems like a really obvious choice to keep it for $600/year.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I was 23 when my dad died. My undergrad was paid off, but I was a grad student living across the country with a beater car and no real income. The life insurance is the single reason I have a stable life in my 30s. My mother kept the other money as she still likely had another 30-40 years to go. I’d keep paying it.

Yes, but OP has already fully funded college, and has $6 million on hand that could go to children, so the insurance policy is not needed.

OP, once you hit 20 years, let it lapse!

OP is in her early 50s. Say DH dies tomorrow. OP, a SAHM, could live another 40-50 years. $6M is not a lot of money, especially if she needs any kind of care. That money cannot go to the children.

[Anonymous]

It's only $6,000 for the next 10 years. I would keep it.

[Anonymous]

Once the term was over, my DH’s policy went from $1200 to $12,000 per year. We dropped it. We are retired if that matters and kids are launched.

[Anonymous]

Anonymous wrote:It's only $6,000 for the next 10 years. I would keep it.

There is a vanishingly small chance the premium will remain $50/month for the next 10 years. Use your head, PP.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Based on the timing, I'm guessing it's a 20 year level term On year 21, the premiums will increase significantly. I'd keep it until then, and then allow it to lapse.

This is what we plan to do, in a similar situation (we are currently something like 12 years into the 20-year term).

+ 1. This is what we are doing as well, except we are at year 17. I have insurance through work (federal) for $300k (me) and $150k (spouse). At this point, we no longer named a million each.

[Anonymous]

As a suggestion to others, we brought term life insurance right before having kids. It was for 20 years. Then halfway through, we bought another 20 year policy and dropped the first which got us coverage to age 60. We upped the coverage for about the same amount of money.

[Anonymous]

Anonymous wrote:It’s basically pennies to pay at your net worth. Seems like a really obvious choice to keep it for $600/year.

This. $600 for a $1m bet why get rid of it?

[Anonymous]

Question on Term Life policies. Do we have to actively stop paying the policy at year 20 on a 20 year policy? Ours are direct debit to the bank. What happens if we don't? Will they automatically charge us for the higher amount from year 21?

[Anonymous]

Anonymous wrote:As a suggestion to others, we brought term life insurance right before having kids. It was for 20 years. Then halfway through, we bought another 20 year policy and dropped the first which got us coverage to age 60. We upped the coverage for about the same amount of money.

This is either wrong, or you chose really poorly for your first insurer. There is no way out got more coverage, 10 years later, for the same premium.