"Paid Up" Whole life Insurance

[...]

No, there really isn't more to this equation.  Do you want to pay more
for reduced risk, or pay less for increased risk?  If you took the
standard policy for half-premium, would you put the difference into a
15-year investment, or just spend it?

The main problem with whole life is that, as a bundled product
(insurance plus investment plus tax treatment), it is harder to compare
apples-to-apples with separate products.

More important might be your choice of whole life vs. term life. If your
beneficaries include young children with no other source of support, you
probably want to load up on relatively cheap term life until they are
close to adulthood.  This doesn't preclude a complementary whole life
policy, but I would think of it more as diversificaton than the primary
way of meeting my needs.

-Mark Bole

 > The main problem with whole life is that, as a bundled product

 

    I have to take issue with the above reference to the Whole Life =
Policy
    being a bundled product of Insurance, plus investment.

    There is NO Investment offered in Traditional Whole Life. The =
investment
    that occurs is done BY the Company, for the benefit OF THE COMPANY.
    The contract offers a GUARANTEED interest to be earned on the Cash
    Value of the contract, which is REQUIRED by LAW, for the SOLE =
PURPOSE
    of guaranteeing that there will be sufficient dollars in the company =
coffers
    to pay the Face Amount upon YOUR Death.

    Anyone who purchases a Whole Life contract as an "investment tool" =
is
    being mislead.There are MANY better vehicles that can be used for =
that purpose.

    Any Life Insurance should be purchased to fill an INSURANCE NEED.
    If per chance that NEED is dissipated over time, then ANY Permanent
    policy's Cash Value may turn out to be the best investment made ! ! =
! ! !

Whole life, universal life, guaranteed life, whatever you want to call
it, clearly there is an investment component.  I get an annual statement
from the policy I bought twenty years ago which shows me exactly how
much interest I earned the past year.  At present, my interest earnings
meet or exceed my premium payments plus costs, but that is not
necessarily true of past or future periods.


What do you mean by "dissipated [sic] over time"?  Is there an
investment component?

-Mark Bole

        What you are seeing is the Total Value of the Cash Value Account.
        It includes a portion of the interest that was earned the company,
that has been
        applied to YOUR contracts C/V. That Cash Value does NOT (and I
repeat)
        DOES NOT belong to YOU. It is the property of the Company, and it IS
        required to REMAIN in the contract, to offset the cost of the
payment of
        the Face Amount of the contract.

        You seem to be confused with the fact that in the event that Y  O  U
        decide to SURRENDER the contract, (give up the Face Value Benefit),
        then the C/V account, no longer being REQUIRED, is RETURNED to YOU.

        In the meantime, YOU can ask for a LOAN, from the COMPANY (which is
        guarranteed), using that same Cash Value as COLLATERAL........

        If it is a form or Universal Life (as opposed to W/L), then you can
        WITHDRAW money from the account, which will REDUCE the FACE VALUE
        (read Death Benefit) by that same amount. So in effect you are
taking a portion
        of your Death Benefit while alive.



 > -Mark Bole

        I used that word to signify that you NO LONGER HAVE THAT NEED.
        There was NO reference to investment.

Cal Lester  CLU