Whole life leaves a hole
Question: John is single, 54 years old and has no kids. He bought whole life insurance policies several years ago. He has 4 policies totaling $20,000. Should he stick with them since he's so far into them? Dave thinks that's a shoddy idea.
Dave Ramsey's advice: That's not enough insurance to spit at, to start with. This is a large hassle in your life, so I don't know why you'd keep it. If no one counts on you to eat, then you are self-insured, and therefore I'd get rid of this crap. Just because you've been ripped off for 20 years doesn't mean you need to keep getting ripped off. Take the money you'll get from this and run. This life insurance policy is the payday loan insurance of the middle class.
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One does not purchase whole life insurance for the cashv value but for the lifetime death benefit. Fact is97% of whole life policies actually pay a DB. I say keep it brother. Your family will have a tax free death benfit and will be able to settle up on your affairs and offset expenses that they may incur as a result of your death.
# Posted by John Howard
| 3/29/08 5:27 PM
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