Life Insurance Policies Under The Janszen Scenario

[shiny!]

Re: Life Insurance Policies Under The Janszen Scenario

Like others have said, do you have a spouse and/or children who would suffer financially without your income? If so, Term life is essential, IMO. The younger and healthier you are, the lower your rates. Get at least a 20-year term. Locking in your premium with a 30-year is better, IMO, because something unforseen could happen that could make you uninsurable. Try to pick a good company that will remain solvent in coming years.

My husband had a 30-year Term life policy through Transamerica. The premium was automatically debited from the bank every month. We never missed that money. Last year he was killed while driving to work. I'm very glad he had that policy. Never once did it make me wish that he was dead. On the contrary, every time I saw the debit entry on a bank statement it was a reminder of how much he loved me.

I guess how a spouse views your insurance policy really depends on the caliber of the person you're married to. If it makes them wish you were dead, you're either behaving badly or you're married to the wrong person.

[jiimbergin]

Re: Life Insurance Policies Under The Janszen Scenario

Like others have said, do you have a spouse and/or children who would suffer financially without your income? If so, Term life is essential, IMO. The younger and healthier you are, the lower your rates. Get at least a 20-year term. Locking in your premium with a 30-year is better, IMO, because something unforseen could happen that could make you uninsurable. Try to pick a good company that will remain solvent in coming years.

My husband had a 30-year Term life policy through Transamerica. The premium was automatically debited from the bank every month. We never missed that money. Last year he was killed while driving to work. I'm very glad he had that policy. Never once did it make me wish that he was dead. On the contrary, every time I saw the debit entry on a bank statement it was a reminder of how much he loved me.

I guess how a spouse views your insurance policy really depends on the caliber of the person you're married to. If it makes them wish you were dead, you're either behaving badly or you're married to the wrong person.

As many of you know, pricing insurance policies, especially life insurance, was my job as an actuary prior to my retirement in 1998. I never owned a whole life policy, but there are people, especially those who can not save on there own who it can benefit. A young person who has no financial dependents has no need for life insurance unless they believe this situation will change. Remember your health situation can change in an instant and you can become uninsurable risk. Term life insurance is dirt cheap, especially at young ages. In my opinion, even more important than life insurance for the young family person is disability insurance. If you get disabled, not only does your family lose your earning power, but they have you to take care of. One thing to remember is that term life insurance ends at the end of the term. If for some reason you have become uninsurable by the end of the term and you still need life insurance you are out of options. Now if you are working, you probably have some insurance through your employer.

[raja]

Re: Life Insurance Policies Under The Janszen Scenario

I was wondering if anyone had any opinions on buying long-term (30 year) term life insurance policies now before an assumed increase in inflation over that time. On the one hand inflation will decrease the value of a payout, but at the same time the premiums will decrease as well. If someone is young and healthy and can get the lowest rates possible now, should one purchase a large amount of life insurance now? Any thoughts/ideas would be greatly appreciated.

With life insurance, you're buying somebody else's promise to pay in the probably distant future.
The 2008 crash was just the opening act of what's to come, and now is not the time to trust any promises, which includes Federal Reserve Notes. Europe is imploding, Japan's about to blow, and IMO hyperinflation in the US is highly likely. Do you think your insurance company will exist when all that comes to a head?

Take the money you would be spending on insurance payments, and invest it elsewhere in something real.
Unfortunately, there is nowhere "safe" to invest at this time, as all investments carry significant uncertainties.
If I were in your situation, I'd probably take my insurance payments and put half in physical gold and half in cash. Stash the cash, and look for opportunities at a later date.

In stable times, life insurance might be a good idea . . . but not now.

[jiimbergin]

Re: Life Insurance Policies Under The Janszen Scenario

With life insurance, you're buying somebody else's promise to pay in the probably distant future.
The 2008 crash was just the opening act of what's to come, and now is not the time to trust any promises, which includes Federal Reserve Notes. Europe is imploding, Japan's about to blow, and IMO hyperinflation in the US is highly likely. Do you think your insurance company will exist when all that comes to a head?

Take the money you would be spending on insurance payments, and invest it elsewhere in something real.
Unfortunately, there is nowhere "safe" to invest at this time, as all investments carry significant uncertainties.
If I were in your situation, I'd probably take my insurance payments and put half in physical gold and half in cash. Stash the cash, and look for opportunities at a later date.

In stable times, life insurance might be a good idea . . . but not now.

Obviously, I am biased, but for a male age 35 in decent health the annual premium for $500,000 of life insurance is less than $600 per year. Even a 50 year old can get $500,000 for less than $1000 per year. If you have a family and something bad happens to you before you invest that $500 per year, your family may be in deep trouble. So I have to disagree with you.

[shiny!]

Re: Life Insurance Policies Under The Janszen Scenario

With life insurance, you're buying somebody else's promise to pay in the probably distant future.
The 2008 crash was just the opening act of what's to come, and now is not the time to trust any promises, which includes Federal Reserve Notes. Europe is imploding, Japan's about to blow, and IMO hyperinflation in the US is highly likely. Do you think your insurance company will exist when all that comes to a head?

Take the money you would be spending on insurance payments, and invest it elsewhere in something real.
Unfortunately, there is nowhere "safe" to invest at this time, as all investments carry significant uncertainties.
If I were in your situation, I'd probably take my insurance payments and put half in physical gold and half in cash. Stash the cash, and look for opportunities at a later date.

In stable times, life insurance might be a good idea . . . but not now.

If you buy a term life policy, you're gambling that the insurance company will be around to pay off the claim years down the road. If you don't buy a policy because you fear that none of these companies will survive, that's a gamble, too. You're gambling that the tiny amount of money you would have spent on a monthly premium can be invested in a way that will pay off as well or better than what the policy would have paid.

A healthy 33 year old male can buy a $750,000 policy for $360/year... that's about $30/month. That's not enough money to miss. It's not enough money to buy a useful amount of gold, real estate or any other safe haven investment.

Our monthly premium was $54.50/month paid for almost 12 years until my husband died, for a total premium cost of $7739. Because he waited until he was 50 years old to buy insurance, we couldn't afford a $750,000 policy or anything close to that. I won't say how much our policy was for, but the amount of gold that $7739 would have bought over 12 years was nowhere near as much as the insurance payout. Even if we had put $7739 all in gold when gold was $300/oz, it wouldn't be worth nearly as much today as what that policy paid out.

That policy didn't make me rich and I have to live frugally, but because of it I can keep my home and probably won't be eating cat food down the road. It was the best way by far to invest $54.50/month.

[BadJuju]

Re: Life Insurance Policies Under The Janszen Scenario

That policy didn't make me rich and I have to live frugally, but because of it I can keep my home and probably won't be eating cat food down the road. It was the best way by far to invest $54.50/month.

Unless you succumb to becoming a crazy cat lady.

[c1ue]

Re: Life Insurance Policies Under The Janszen Scenario

The counterparty risk is real, but so is the risk of an untoward event killing you and screwing up your family.

From a statistical standpoint, the counterparty risk is actually far smaller than the other one - for one thing, we can be quite sure that the government will step in should a large insurance company have problems. We're still in FIRE, and even if we magically weren't - the government has in the past, and likely will do so in the future, intervene when large numbers of voters get materially injured by a private company failure.

Put another way: if Mad Max occurs, neither the gold nor the bank account is going to help you anyway - unless you already are or can quickly and easily get yourself, your family, and your assets out of the US.

Thus I would not look at a hypothetical future default on payout as the deciding factor on buying term life insurance, I'd look at how vital your income is to your present and near future economic existence.

[shiny!]

Re: Life Insurance Policies Under The Janszen Scenario

Unless you succumb to becoming a crazy cat lady.

I'm already a crazy cat lady with three elderly felines that are starting to get expensive health problems. And a bulldog that eats sofas. No more pets after these.

[BadJuju]

Re: Life Insurance Policies Under The Janszen Scenario

I'm already a crazy cat lady with three elderly felines that are starting to get expensive health problems. And a bulldog that eats sofas. No more pets after these.

You say that now, but when one finds its way into your life, you'll change your tune.

[shiny!]

Re: Life Insurance Policies Under The Janszen Scenario

You say that now, but when one finds its way into your life, you'll change your tune.

Oh God, you're right, but can they wait until I'm in Uruguay or somewhere? There have to be strays there that can make me their slave.

[BadJuju]

Re: Life Insurance Policies Under The Janszen Scenario

Oh God, you're right, but can they wait until I'm in Uruguay or somewhere? There have to be strays there that can make me their slave.

Since when are you moving to Uruguay?!

[shiny!]

Re: Life Insurance Policies Under The Janszen Scenario

Since when are you moving to Uruguay?!

Not necessarily Uruguay, but I'm looking for a quiet, stable country with abundant water and a mild climate that isn't a police state. Someplace with a lower cost of living -particularly medical care- than the U.S. But with Peak Cheap Oil upon us I'm not sure that place exists.

[BadJuju]

Re: Life Insurance Policies Under The Janszen Scenario

Not necessarily Uruguay, but I'm looking for a quiet, stable country with abundant water and a mild climate that isn't a police state. Someplace with a lower cost of living -particularly medical care- than the U.S. But with Peak Cheap Oil upon us I'm not sure that place exists.

What about Canada? Pacific Northwest of the US or Canada?

[shiny!]

Re: Life Insurance Policies Under The Janszen Scenario

What about Canada? Pacific Northwest of the US or Canada?

Canada fails the "mild climate" requirement (I have Raynaud's). Pacific NW in the U.S. fails the "low cost of living/low cost of health care/not a police state" requirement.

[BadJuju]

Re: Life Insurance Policies Under The Janszen Scenario

I see. As much as I don't like where the USA is going, I still think it will be the best place to be relative to other countries aside from maybe Canada. And that goes doubly so if you live in a really good area like the Pacific Northwest.