Life Insurance--do you have it? Should I have it? Cost?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I am in a similar situation as OP as far as salary, ages and kids. We do not have life insurance. I know it is risky, but from what I understand, term is the best to have yet only 2% of term pays out. So I would rather keep that $30,000 or so and then when I am 70 and term runs out, I didn't waste it.

Holy crap, this is perhaps the most self-centered and irresponsible post I've ever seen on DCUM. And that's sayin' something.

PP, I don't even know where to begin. You need your head examined. That some people don't have life insurance is kinda irresponsible. That you have made a considered decision NOT to purchase life insurance is mind boggling.

Actually, it's fairly smart. Life insurance is a bad deal, with a low expected rate of return on your investment. If you can save on your own, you can do better - at the end of say 30 years, you'd have a lot more money in the pot, and you or your kids could use it without you having to die first. But the problem is, most people don't save, so they need life insurance or 401(k)s or whatever to make them save.

The other reason to get life insurance is for mental piece of mind - if you lie and bed and worry about what will happen to your family. In this case, you're not making an economic calculation (because, as I said, you can do much better by saving on your own). You're buying something non-tangible, i.e. peace of mind.

If you don't mind risking losing your house and trying to support a family on one salary, then it sounds great. What if your DH has an illness and there are medical bills to pay off? You will leave nothing for your family. What if one of you goes into assisted living? We got life insurance as soon a we got a mortgage and are increasing coverage now that we are starting a family.

[Anonymous]

Maybe the smart people here can weigh in on our situation. I'm a SAHM and DH just cracks the 6 figs. I have universal life and he has a 30yr term. We are in the last year of eligibility to convert his to universal if we want. I don't think we can swing the two payments so we're most likely going to keep his as term. Both policies are for 500k. We figure mine can be used to help him with options in childcare if I die, and his is obvious. He also has some coverage through work so I think in total he more like 750k. We have a diverse retirement investment strategy including his 401k and my Roth. Our thought is my universal life also allows us other retirement income options, or the ability to use more of our retirement savings for ourselves and still provide a small estate for our kids eventually. Anyway, we were fairly young when we did this and have wondered about how smart it actually was. Sometimes we struggle making the desired college savings payments and often look at the universal life payment as lost college savings. But then we remember you can't get a loan to retire. You ladies never pull punches, let me know if I needed to surrender that universal policy in favor of a term policy, like, yesterday.

[Anonymous]

I think VUL (variable universal life) policies are a scam. With the fees, etc, you can do better buying a standard term policy and investing the rest elsewhere. Insurance shouldn't really be an investment vehicle, IMO. VUL has been pitched to us a few but it just doesn't make sense to me. I understand the concept, I just think you can do more with that same money another way.