GOD@drutx.UUCP (GOD) (04/05/85)
> I recently bought an insurance policy with the intent of using the > cash value each year to finance an IRA (this is what the policy is > designed for). A representative from a competing company then showed > me a policy that had a premium about two-thirds of what I am now > paying and told me I had really been taken. Her policy was "Unit Life" > while the one I have is "Whole Life". Before I make another payment > and make a bad deal worse, I need to know if I really have a bad deal. > Can anyone suggest where I might get OBJECTIVE advice on my current > policy? Does anyone have experience with this type of arangement? I was involved with Life Ins for almost a year, and from what I saw Whole Life policies are the worst available. Universal Life was OK, but recent law changes took care of that. Now, the minimum insurance corridor on these policies (this is the minimum difference between cash value and TOTAL death benefit) has been increased; so U-Life is not a good investment anymore. Also, it used to be that any withdrawal from the cash value on U-Life was tax-free until the principal was exceeded. Now withdrawals are taxable until only the principal is left in the policy. I can assure you that the best investment is to buy the cheapest term insurance available (from a company that's been around for awhile), and invest the rest on your own. From the description of your present policy, I would suggest that you buy term + an IRA. I can't understand why you would put the money in a Life policy, then take it out right away for the IRA. Why not just put it in the IRA to begin with? Dave Van Handel
bill@utastro.UUCP (William H. Jefferys) (04/08/85)
> I can assure you that the best investment is to buy the cheapest term > insurance available (from a company that's been around for awhile), and > invest the rest on your own. > From the description of your present policy, I would suggest that you > buy term + an IRA. I can't understand why you would put the money in a > Life policy, then take it out right away for the IRA. Why not just put > it in the IRA to begin with? > Amen to that. By the way, if you or your spouse are employed by a college or university (as many are on the net) the lowest premiums by far are offered by TIAA (Teacher's Insurance and Annuity Assn). It enjoys the highest ratings in Best's, and is a super deal. Premiums run 30-50% lower than competitors. Not affiliated, &c., &c. -- "Men never do evil so cheerfully and so completely as when they do so from religious conviction." -- Blaise Pascal Bill Jefferys 8-% Astronomy Dept, University of Texas, Austin TX 78712 (USnail) {allegra,ihnp4}!{ut-sally,noao}!utastro!bill (uucp) bill%utastro.UTEXAS@ut-sally.ARPA (ARPANET)
djvh@drutx.UUCP (VanHandelDJ) (04/10/85)
> > The clincher was the 50% premium dividend (i.e. refund!) that the > IEEE plan has been paying for a while. These dividends are not > quoted in the rate tables for any policy I've seen so you need > to ask before making a decision. Be careful with dividends. First of all, all a dividend is is an overcharge of premium, which the company pays back to the insured at the end of the year, if company expenses go as expected. Dividends are NOT like earned interest (You don't pay taxes on a dividend; it was always your money, the company just used it for the year), they are not guaranteed either. If the company has a poor year, it does not have to refund any dividend. Dave Van Handel
bwm@ccice2.UUCP (Brad Miller) (04/12/85)
Personally, I would never buy anything other than term life insurance. Whatever you decide, I would, however, suggest you make sure the company underwriting the insurance is licenced to sell it in NY state. Not because I am a big fan of NY state, but because their regulations are the strictest in the nation. Since (esp. with whole life) you are depending on the company being around in several years, knowing they have the money in relatively safe places to back up the insurance is a good idea. Brad Miller -- ..[cbrma, ccivax, ccicpg, rayssd, ritcv, rlgvax, rochester]!ccice5!ccice2!bwm