Using Universal

Lonnie has a universal life insurance policy. He has the option of cashing out $15,000 and continuing the policy until he is 63 years old. He has diabetes and can't get another policy. What would Dave do?

QUESTION: Lonnie in Sarasota has a universal life insurance policy. He apparently has the option of cashing out $15,000 and continuing the policy until he is 63 years old, but he doesn’t know what to do with the money. He has diabetes and can’t get another policy. What would Dave do?

ANSWER: I’m confused as to how you can take that money out of there and maintain the policy. Perhaps they quoted you the figure that you could take out and leave enough in there to pay it through. If you need life insurance, you don’t want to do something that causes you to lose the policy. You need to figure out what you can do, but if what you’ve described is possible, then pull the $15,000 out and let it run its course, then you invest your money. If you have that as an option when you really dig into it, then I would definitely do that.

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