Is life insurance needed?

Depends on if you care about someone enough to perhaps want to leave them something?
 

Just make sure you leave the executor of your estate enough money to execute your will.

As to life insurance, it largely depends on the specifics of the policy, your age, and where you think your life will head.

I am extremely happy that I bought some whole life insurance in my late 20's and held on to it all these years. I was divorced at the time but needed to ensure the future of my two young children. I also bought larger, and cheaper, term policies that have expired long ago.

I have long since paid off those whole life policies and they sit there gaining in value every year at a non taxed rate of about 4.5%. I also purchased a policy for my current wife and it is paid off as well. Our monthly life insurance/long term health insurance cost is zero.

So now I have a cash value of about $200K sitting there that can be used for anything I want. Or they provide about $200K insurance for me that can also be used for Long Term Health Care if I need to use it that way. I didn't buy the policies for my current wife until much later in life, so she has less coverage than I do, but again hers can also be used for Long Term Health Care, and it continues to grow.

Would I buy these whole life or term policies today, absolutely not because we are simply too old and the cost would be prohibitive today. That particular train has left the station.

When I talk to younger family members today, I advise them to buy fairly big term policies because they are cheap, but always augment them with smaller whole life policies that will be paid off at some point, but don't have to be renewed. I have seen so many instances of people buying only term insurance and then not being able to renew it because the insurance company somehow finds out that they now have a significant health issue.
 
I took an actuarial hit on my defined benefit pension so that it will pay my wife the same full amount if I die first.

Also her social security check which is about 1/2 of mine will be increased to the same amount that mine is.

Hell, I'm already worth more to her dead than I am alive. So do I need life insurance too?

Hell no.
 
A Term Life Insurance policy might make sense when a person is younger, and has family/housing, etc., responsibilities, to be covered, if something were to happen to them. However, an older person who has no family responsibilities, debts, etc., and has enough set aside for their final costs, really has little need for life insurance, IMO.
 
"Say someone never married, had no children or other dependents, and had a pre-paid funeral." There doesn't seem to be any reason WHY someone would want life insurance. But most people aren't like that. It all depends on your income and what you want to do. The pieces of estate planing are changing. What is legal and accepted practice on Monday, may not be on Friday. So something set up 20 years ago may be outdated, and ineffective today. I'm no financial advisor, but if you have an estate, you should be re-evaluating your plans, at least yearly, with an competent estate planner. My mom got messed over by what some overly shrewd lawyer set up in the 1960s. It involved me buying my parents home for $1. Tax people said nope to that stuff.
 
This is a GREAT subject... a lot to think about. I think a lot of people have life insurance so they will have a proper burial and not be a burden on their family. Truth be told, I will keep my policy because I plan on enjoying the money that I do have. Call it selfish, its ok.. I deserve to LIVE LIFE, ENJOY LIFE!!! This is just me but it will not take thousands of dollars to put me in a casket.. I won't know the difference where they bury me. Funerals are a showcase for family and friends.. I won't know the difference, neither would I care.
 
debodun said:
My great-aunt once said, "They'll HAVE to bury me either for the love of me or the smell of me."
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Guessing your great-aunt was a woman that called a spade a spade and not "an instrument with which to turn the earth."
She sure didn't mince words!
 
debodun said:
She was a character all right! My mother's father's sister.
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Not too many people with that kind of common sense. My dad used to say "the most uncommon thing in the world was common sense...most people have the common sense of the rear end of a Wyoming horse facing Utah." That would be a good thread to start...common sayings in your family tree...lol.
 
I don't know how to say this, but with the trusts that my wife and I inherited from our families, there was no need for any money for funeral expenses. We cashed in our policies years ago. However, if someone who will be needing money for final expenses, then maybe they should consider having at least a small policy to cover those expenses for when the the time comes.
 


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