I am 44 years old married, with 5 children, ages 24, 21, 20 14 and 6 which would be better whole or term life

Question

my husband is 45 we do not have anything saved due to him being out of work for 3 months last year. He is working now and has ad&d insurance through his job. I am a stay at home mom. 2 of the older kids are married and have steady income. So, again which is better whole or term life insurance.

Answer 1

You need to decide why you need a policy, and how long you'll have that need. Based on the limited information you provided I'd suggest a 20 level term. This will see your youngest through college, which is probably why you need the policy. Whole life is warranted in very few situations and it doesn't sound like your situation is one that it would be warranted. If you need the policy longer than 20 years a universal life might be better but you'd need to weigh the benefits against the extra cost.

Even though you are a stay at home mom you also need coverage although a 10 year term may be best for you. Who would watch over the 6 year old if something happened to you? Many people don't realize the value of a stay at home mom until they're gone.

Answer 2

I would say that a level term policy is probably best - provides the most payout for the least premium.

Answer 3

All of you need a Whole Life policy - enough for burial...because one of you dying & having to pay $10K for a burial would break your family.

Nobody wants to leave their family "in the whole" when they die...so put get a family Whole Life policy for at least $10K...25K if you can afford it!

Then if you own a home...get term policies to cover the mortgage on both you & your husbands lives....

If he's gone, you'll need the house paid off or you'll lose it!

If you're gone, he'll be able to pay some on the house, take time off of work & seek help with the smaller 2 (or 3) kids!! He's going to need some "support $" until he & the kids are able to find someone to replace your child care position

***If you do NOT own a home - you still need approximately $50K term or whole life - whichever is in your budget to help the other with household expenses and getting help with the kids

Answer 4

I'm a financial representative and providing life insurance is one of the things I do for clients. God forbids if the breadwinner dies, where would the family be without life insurance? Life insurance can't protect you against harm or death, but it can replace your income. The problem is that many families that own life insurance don't have adequate coverage, but they pay lots of premiums for it. That's because they own the wrong type of life insurance. Take a look at the facts and you decide which product is the best:

Whole life insurance

1) Its level term to around age 100 that builds cash value.

2) Since it builds cash value, premiums are higher than term insurance that doesn't build cash value.

3) There is no cash value growth in the first 2 years because premiums are used to pay for the insurance and commissions to the agent.

4) After first 2 years, you are guarantee a rate of anywhere between 1-4% (varies between companies)

5) If you wish to take money out from the cash value, you have to borrow it and pay loan interest of 6% to 8%.

6) If you die someday, the insurance company keeps your cash value, but pays the death benefit. Death benefit will be reduced by any loans you taken from the cash value.

Universal life insurance

1) Annual renewable term until around the age of 100 that builds cash value.

2) Flexible premiums as long as there's enough cash value to pay for the insurance.

3) While premiums may remain level in the beginning, the internal cost of the insurance goes up every year. That means less and less of your premiums goes into the cash value. Eventually, the premiums you pay will be insufficient in the future to pay for the cost. What would happen is that you would either have to pay more premiums or a portion of your cash value will be used to pay for it.

4) Same cash value features as whole life.

Term insurance

1) Various of level term products to choose from (from 1 year to 35 years).

2) It does not build cash value, so premiums are initially lower than whole life and universal life.

3) Most term insurance are guaranteed renewable to around the age of 95 to 100 without providing a proof of insurability. If your health was to decline because of old age, you can renew your policy without any hassle.

4) When you renew, premiums will be based on your current age. So premiums will go up after the initial level term.

Those are the facts.

Personally, I have sold term insurance 100% of the time. Why? Its because my clients can get lots of coverage for low amount of premiums. Since premiums are low, I help setup investment accounts for my clients so that they can build wealth. If you had lots of money saved right now, would you still need life insurance? Probably not. But you probably don't have lots of money saved right now and if something were to happen to you, would your family be financially ok? As you get older and continue to invest, you may or may not need life insurance when it is time to renew the term insurance. If you were to invest $200/month for the next 30 years and the average rate of return in your portfolio was 12%, you would have about $700k saved for retirement. That's probably not enough to live on, but at least its better than having money sitting in a life insurance policy. If you were to die during the term, your family gets the death benefit and all your savings and investments. If you die after the term, at least you will leave money behind to your family. With the cash value life insurance, in most policies, your beneficiary will only get the death benefit, but the insurance company keeps the cash value.

Base on the information you know now, you would know whether an agent is trying to rip you off or is really there to get you the best coverage possible for the lowest possible cost.

Answer 5

Well, what's the exact GOAL??  You can buy much more coverage for your money, with term.  One 20 year term policy will see all your kids grown up.  And it costs a FRACTION of the price of whole life.

Most likely, the term is what you need.