Graded Premium Whole Life vs Buying Term and Investing

welcome

YES. The increase(s) in the premium are spelled out in the contract, either small annual increases over a period of years 3,5 or 10, or major jumps evrey 3 or 5 years, then STOPS.

Generally speaking NO. Since it is a form of Whole Life, the actual premiums are spelled out, and can NOT be adjusted.

Sorry, but my crystal ball just dropped on the floor, and shattered...........

FALSE. All insurance has a high cost. How do you think they get the money to pay your heirs a million bucks when you die.

Whole Life policies DO NOT EAT AWAY AT THE CASH VALUE. The Cash Value is GUARANTEED to be EXACTLY as stated in the contract on any given day. It will CONSTANTLY INCREASE as long as you continue to pay premiums.

Cal Lester CLU

LavaDude, If you are younger and Insurable, you will want to replace any whole life insurance with a 20 or 30-year term policy and invest the difference. Just remember that at 3% your money doubles every 24 years,

6% every 12 years, and at 12% every six years. Most Whole life policies will guarantee 3-5% only after the first few years. To give you an example of what this means over a 35yr period, Investor A, B, & C all invest $200 a month. Investor A plays it safe and purchases a CD or money market account and earns 3%. At the end of 35 years he goes and withdrawals approximately $150,000. Okay, but remember inflation may have been 4%!! Investor B invests and earns 6%,....earns approximately $295,000. Even better, right? However, investor C, realizes that over an extended period, Mutual Funds have average a 12% average. At the end of 35 years, Investor C withdraws....1.3 million. Your money will double every six years. That is the difference. This is why Insurance Companies and Banks are the biggest buildings downtown. Take it a step further, You are investor A and the Bank, or Your Whole Life Policy is investor C. At the end of 35 years, you decide you want to cash in your (Cash Value) policy. The C gives you your 3% or if you lucky your 6%, and they keep the difference. They call that the profit. No one has a crystal ball, but you can buy far more coverage with term while you build your assets. And when you have reached Financial Independence, you are now self-insured. If you have a Whole life policy, but sure to look at the Guaranteed Cash Value and not the "Possible Cash Value!'

Andrew Keck

Obviously you are insurable, and there is in all probability some chance that you will LIVE more than 20 or 30 years. There is also a possibility that YOUR SPECIFIC NEEDS FOR INSURANCE just might continue beyond that time period. There is also some possibility (it has happened) that the "market" will go down..........

Just remember that at 3% your money doubles every 24

sounds intriguing, but seems to have ignored "GUARRANTEE"'s. The original thread dealt with a Whole Life contract. There are a multitude of Interest Sensitive AND/OR Market sensitive contracts that are available, which offer potential for "growth", but also contain GUARRANTEE's.

Extremely missleading statement. The carrier does NOT KEEP any of the Cash Value after 35 years. There are surrender costs in the early years as there are with CD's and other investments. IF and WHEN YOU decide that YOU no longer NEED the Life Insurance that the contract offers, then you have the ability to Cash-in the policy, and receive the ENTIRE Cash Value as of that date.

They call that the profit. No one has a

ABSOLUTELY correct, in that there is no crystal ball, but there are GUARRANTEES. The writer of the above ASSUMES (and you know just what that spells) that EVERY INVESTER will have the stamina to mainatin the investment program, and become "finacialy independent". I dare say that has NOT happened to many people who elected to follow the "buy term - invest the difference" philosiphy. Cal Lester CLU