Do we really need a will and life instance?

[Anonymous]

We have a 3yo and a 12 mo old. My parents have started really nagging us but it seems overwhelming. Not sure where to start. Where do you start in pricing life insurance? Do we need a lawyer for a will? Ugh--I hate this stuff. Any advice? If everyone does this it can't be so hard, but yet we don't know where to start.

[Anonymous]

Yes, unless you want the State to decide where your children go.

[Anonymous]

Anonymous wrote:We have a 3yo and a 12 mo old. My parents have started really nagging us but it seems overwhelming. Not sure where to start. Where do you start in pricing life insurance? Do we need a lawyer for a will? Ugh--I hate this stuff. Any advice? If everyone does this it can't be so hard, but yet we don't know where to start.

For life insurance, just try to look for term. Also check out the options at work during your next benefits enrollment period, which will likely be in November.

Yes, you need a will. Your children wouldn't automatically go to your parents should you both die, if that is what you assume now. Only a will can ensure that. You'd also name backup guardians and trustees for any money you would leave them (usually you want the trustees and guardians to be different people).

[Anonymous]

If you are healthy I would not get life insurance through work partly because the rates may well be higher (because there usually isn't a health exam) and partly because if you leave you probably cannot keep the insurance (and at that point it will be more expensive, possibly much more, to get your own insurance).

Get guaranteed level term for how many years you think you need to provide for your kids-- I'd say at least 20 years. You can find online calculators to help you figure out how much you need but a rough rule of thumb (as a starting place) might be 5-8 times annual salary (I think SAHPs need insurance too, but the calculation may be different).

You can start pricing online, at insure.com or accuquote or a site like that. If one of you has a health issue or family issue you might want to try and find an agent who can help you figure out which company would have the best rates (and still be highly rated for financial stability).

For a will, I'd suggest starting with the Nolo willmaker book/software. You'll learn about the issues, start thinking about what you want to do, and you can get a simple will in place without too much effort. Then when you have a little more time you can try to find a lawyer to do something more complex/customized.

Definitely do both of those things, and then also consider disability insurance (although it's expensive) and umbrella liability (which is cheap).

[Anonymous]

We got $2M for me and $1M on my wife.

We haven't done the will yet, but that's next.

[Anonymous]

Widowed with an infant here. Odds are it won't happen to you...but it does happen.

Term life. Used USAA and didn't really comparison shop, so maybe others will chime in. Got a great rate while young and healthy.

Take advantage of employers' life insurance, 1x salary is pretty standard benefit, then you can pay to increase it (in our case, to 4x salary).

We used a will in a box and had our neighbors witness it, thinking we won't need this and "soon" we'll meet with a lawyer and write a "real" will. DH died before we got to that and it was a bit of a pain. Now I have a will and living trust written by an attorney.

[Anonymous]

It's important and costs some money but these are things that you should take care of. Our biggest stumbling block has been figuring out who would care for our kids if we both died.

[Anonymous]

Anonymous wrote:Widowed with an infant here. Odds are it won't happen to you...but it does happen.

Term life. Used USAA and didn't really comparison shop, so maybe others will chime in. Got a great rate while young and healthy.

Take advantage of employers' life insurance, 1x salary is pretty standard benefit, then you can pay to increase it (in our case, to 4x salary).

We used a will in a box and had our neighbors witness it, thinking we won't need this and "soon" we'll meet with a lawyer and write a "real" will. DH died before we got to that and it was a bit of a pain. Now I have a will and living trust written by an attorney.

I am sorry for your loss.

I think if you have access to USAA they are usually a good option (although I have not priced them for life insurance either). I agree that a will from a lawyer is better, but I think it's also better to have a simple will than to have nothing, and IME having the simple will doesn't delay talking to a lawyer and it might make things go faster.

[Anonymous]

Term life insurance can be relatively easy -- check out Accuquote or something similar -- they will give you a couple options at different life insurance companies. If you are in good health, prices should be reasonable for a 20 or 30 year level term. Once you make a selection, get a health exam (they come to your house). Also, you may want to check on the financial stability rating of the company online, which is relatively easy to do.

[Anonymous]

I had a horrendous lengthy experience with Accuquote with a sales rep who was so persistent in calling at inappropriate times (including late at night and despite me telling him exactly when was convenient to talk by phone) that it started to feel stalker-ish. Don't recommend them at all. Unfortunately once the process started with medical underwriting etc it seemed too late to switch to another company so we stuck with them.

[Anonymous]

I purchased 10 Pay policies on the kids. Not sure if you can still get, so look into 15 year policy too. These are permanent and will stay with them for life. People frequently don't think about kids' insurability until something happens - sicknes, for example. One DD was born with mitral valve prolapse and was uninsurable. Definitely worth talking to your agent to be sure everyone is adequately covered.

[Anonymous]

Anonymous wrote:I purchased 10 Pay policies on the kids. Not sure if you can still get, so look into 15 year policy too. These are permanent and will stay with them for life. People frequently don't think about kids' insurability until something happens - sicknes, for example. One DD was born with mitral valve prolapse and was uninsurable. Definitely worth talking to your agent to be sure everyone is adequately covered.

I'm sorry for your DD's condition, but I would say whole (permanent) life insurance generally does not make sense for most people.

[Anonymous]

Yes you need a will. Unless your financial life is complicated you don't need anything fancy -- and a Will-in-a-box (Willmaker, etc) is much much better than nothing at all. Don't let the "who do my kids go to if we both get hit by a bus" question trip you up -- the chances are so incredibly small (one of you might die, yes, but both, at the same time? small odds) that you shouldn't lose sleep over it or let it stop you from completing the will.

Insurance depends on what your financial situation is, whether one of you could still pay the mortgage and child care without the other spouse's salary, etc.

[Anonymous]

Anonymous wrote:I purchased 10 Pay policies on the kids. Not sure if you can still get, so look into 15 year policy too. These are permanent and will stay with them for life. People frequently don't think about kids' insurability until something happens - sicknes, for example. One DD was born with mitral valve prolapse and was uninsurable. Definitely worth talking to your agent to be sure everyone is adequately covered.

Why would a child need life insurance?? Sounds like an expensive option that only a life insurance agent would push. In regards to Accuqoute - I also used them to purchase policies for me and DH, and everything went very smoothly. No harrassing phone calls. Just make sure the company you end up purchasing from is well-rated.

[Anonymous]

I know it's overwhelming, but I honestly feel like it's irresponsible not to do it.

Yes, the likelihood of one or both of you passing away in the short term is remote, but as a PP pointed out, it does happen.

Who would raise your kids? Who would control your money? Would you want your children receiving it all at age 18, or have it held back for college or paid out in increments?

DH and I are older parents, and maybe we wouldn't have thought as much about this in our 20s, but we've definitely spoken with our financial advisor and found it useful to have an attorney help us. We have some unique circumstances that would have made the will-in-a-box not as useful for us.

Yes, it's scary and depressing to think about, but you really should do it.