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rated:
I've been thinking about life insurance and recent info about a relative has me thinking about it.

We area dual income house and we have strong savings goals to ensure our early retirement, and our kids can go to college.

However, in the event something happens or an unexpected illness is bestowed upon one of us, I want to ensure the family can continue on the same trajectory.

Currently
Wife and myself are 37.
1 child 15m old
2nd child due in Aug 2017.

I have 50K through my work on my wife costing $4.50 a month post tax
Wife has 25K on herself through her work costing around $8 a month post tax
I have 80K through work free.
I have 160K more through work that I pay $14.21 a month pretax.
I have 15K on my son at $3.00 a month post tax.

I'm considering a large policy on my wife on the order of 750K.
Considering the same on myself, and maybe next renewal, dropping my supplemental life if it doesn't make financial sense.

Spoke to Northwestern Mutual (rated #1 on nerdwallet) and was told as a good estimate:
20 year term fixed flat $750K was around $64 a month for me, and $60 a month for my wife.
These of course will be after tax payments which certainly plays a role.

We are both healthy people, no smoke, no drink, no diabetes (though does run in my family), and no other illness (though breast cancer runs in my wife's family) This last one is the scary one. I love my wife dearly, but her family genes have this issue and I'm doing my son a disservice if I don't address this matter.

I also do not want to be over insured.

The idea of around 750K, is that in the event something happens to one of us, obviously family investment savings would drop dramatically and this would go into investments, left to grow the remaining years until early retirement. (retirement goal in 18 years is around 1.8M currently.)

Also, not sure on how to properly weigh the value of the payout now, vs the value in 19 years (got forbid one of us has to collect).

Also, we snow ski 1-3 times a year, not sure if thats considered major risk.
Also, not sure about family cancer disclosure. Is that necessary? Her mom is fine, other relatives have had issues.



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American General will definitely NOT be the best carrier for you, as you will automatically not qualify for their PP rat... (more)

chislands18 (Feb. 27, 2017 @ 4:34p) |

Thanks for the great info!
I'll def check into this prudential.

As for my numbers. I found my old numbers from 3 yrs ago... (more)

RhizzleBop (Feb. 28, 2017 @ 6:01a) |

No problem - I've helped many FWF with life insurance, so I'm always happy to help!

PRINCIPAL, not Prudential will allow ... (more)

chislands18 (Feb. 28, 2017 @ 9:39a) |

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rated:
1) term4sale.com - good site that aggregates prices for policies.
2) what's your and your wife's salary? some will suggest some multiplier of salary for insurance needed
3) What are your and you're wife's liabilities? (personal loans/debt/mortgages) A primary reason for insurance is to make sure survivors aren't left to struggle with existing liabilities
4) Do you plan on paying for any portion of your kids education? Private or state university? If private, tack on 400k-ish per person per kid since that's about what the cost of private uni will be in 18 years at this rate.

ignore the skiing - that's not a life insurance risk factor.
cancer disclosure - don't provide it to them. If they ask the question (in person or in a form) be honest. Don't tell them what they don't ask for. They have underwriters that take into account whatever information they need to take into account to make their assessment.

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Remember that insurance through your work only lasts until you leave your job, at which time you'll be shopping for new life insurance at an older age.

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RhizzleBop said:   
I have 80K through work free.
I have 160K more through work that I pay $14.21 a month pretax.


Sounds like you are getting 1x salary for free and you are buying another 2x salary through your employer's plan. Once you get your own term insurance elsewhere, drop that 2x additional term. You'll find that it is cheaper elsewhere, and you don't want all your insurance needs being met by an employer-sponsored plan in the event that you switch jobs. Always take the free insurance though.

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The amount you need depends on your expenses & assets. How do you get to the $750k figure?

Getting large 20 year term policies for each of you is a good idea. When you do so, I'd also drop all the policies youre paying for now. Your child does not need insurance either. I'm guessing you're figuring that 15k for 3/mo is cheapish and would cover a funeral but you can self insure that.

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imbatman said:   1) term4sale.com - good site that aggregates prices for policies.
2) what's your and your wife's salary? some will suggest some multiplier of salary for insurance needed
3) What are your and you're wife's liabilities? (personal loans/debt/mortgages) A primary reason for insurance is to make sure survivors aren't left to struggle with existing liabilities
4) Do you plan on paying for any portion of your kids education? Private or state university? If private, tack on 400k-ish per person per kid since that's about what the cost of private uni will be in 18 years at this rate.

ignore the skiing - that's not a life insurance risk factor.
cancer disclosure - don't provide it to them. If they ask the question (in person or in a form) be honest. Don't tell them what they don't ask for. They have underwriters that take into account whatever information they need to take into account to make their assessment.

Thank you

1. Will check it out.
2. I'm at close to 90K, wife is around 65K.
.3. debts: 7K student loans are mine, 9K student loans are hers. Owe 1 car 5yr note borrowed 32K 0% owe 51 months, Primary home mortgage owe 220K, just bought this in July, 30yr loan. Own a rental house that we owe 78K, will be paid off in 9 yrs.
4. We are currently maxing 1 401K, putting 14K in another 401K, and trying to put 5K a year in IRAs. We are ear marking the IRAs for college fund because our offerings have better funds than our 529. ( I know I need to investigate this further for other outside options).
We plan to increase our savings/investing each year as we earn more. If we are where we want to be in 18 years, we plan to greatly assist our kids with college at a state school. If our investments are not where we want to be we'll decide if we want/can work another year or so to help them further etc. it'll be a flex situation.

We plan to have our investments (withdraw yearly growth only during retirement years), along with state pension(wife) rental property all combine for our early retirement. May very well add another rental in a couple years.
Definitely not paying 400K for a private college.

But if life throws a curveball, ( I shudder at the thought) whoever remains wont be socking away retirement funds, on a single income, and the plan to help kids with college needs to stay in tact.
This is why I feel around 750K would be enough to basically cover the funeral and put the rest in investments, keep the household together on a single income, and let that grow into the early retirement nest egg as originally planned.

I'm thinking 20 yr term, which seems like for one of us, would cost around 11.5K over the full 20 years, and hopefully never pays a dime, but it might.

As for the cancer, I think they definitely will ask. My wife gets her annual, and all good so far. But a few relatives are not as lucky. Not sure if they could not pay by ignoring such a question.


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dcwilbur said:   
RhizzleBop said:   
I have 80K through work free.
I have 160K more through work that I pay $14.21 a month pretax.


Sounds like you are getting 1x salary for free and you are buying another 2x salary through your employer's plan. Once you get your own term insurance elsewhere, drop that 2x additional term. You'll find that it is cheaper elsewhere, and you don't want all your insurance needs being met by an employer-sponsored plan in the event that you switch jobs. Always take the free insurance though.


Thats correct, and for the 160K, I pay like $11 a month if you consider its pretaxed. 750K will cost me $63 a month after tax. (Of course that 63 is flat for 20 years, where the employer rate will rise yearly.

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Assuming you both participate in social security, don't forget to figure the survivor benefits your kids will get. It usually a fair amount of money.

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jerosen said:   Assuming you both participate in social security, don't forget to figure the survivor benefits your kids will get. It usually a fair amount of money.
Not tracking how I would figure that or when it would become effective.

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RhizzleBop said:   
jerosen said:   Assuming you both participate in social security, don't forget to figure the survivor benefits your kids will get. It usually a fair amount of money.
Not tracking how I would figure that or when it would become effective.

Go to ssa.gov
Create an account and you should be able to view your SS tax contributions and benefits.

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fwuser12 said:   
RhizzleBop said:   
jerosen said:   Assuming you both participate in social security, don't forget to figure the survivor benefits your kids will get. It usually a fair amount of money.
Not tracking how I would figure that or when it would become effective.

Go to ssa.gov
Create an account and you should be able to view your SS tax contributions and benefits.


Yeah that will give you the estimate of benefits. Its probably in the $1200-1800 ballpark monthly per kid.

If you pass away your children get survivor benefits from social security. They get that benefit monthly until they hit age 18.
The money is for the kids but it can be used to support their needs (food, housing, clothing, medical, recreation, etc).

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How did you come to the 750k figure, and why not 250k or 500k?

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jerosen said:   
fwuser12 said:   
RhizzleBop said:   
jerosen said:   Assuming you both participate in social security, don't forget to figure the survivor benefits your kids will get. It usually a fair amount of money.
Not tracking how I would figure that or when it would become effective.

Go to ssa.gov
Create an account and you should be able to view your SS tax contributions and benefits.


Yeah that will give you the estimate of benefits. Its probably in the $1200-1800 ballpark monthly per kid.

If you pass away your children get survivor benefits from social security. They get that benefit monthly until they hit age 18.
The money is for the kids but it can be used to support their needs (food, housing, clothing, medical, recreation, etc).

Well, somehow I just missed this, and wasn't thinking about it.
Good to know. It would certainly help my wife, or myself maintain our childrens lives with an extra 2-3K a month. (though if its like retirement social security, you get about a .5% increase every other year so inflation eats you up.

Good to know. Adds to the confusion of the calculation.

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gnopgnip said:   How did you come to the 750k figure, and why not 250k or 500k?
The actual figure is $737K that would be needed.

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gnopgnip said:   How did you come to the 750k figure, and why not 250k or 500k?
Well, I havn't attempted hard math on this yet, but a 500K policy will run in the ballpark of $46 a month, and 750K runs $63. (Broker estimated me, and said proportionally my wife would be cheaper cause women live longer)
I looked at that and said, well 46 and just 18 more (less than half) adds half to the policy. Clearly more number crunching is required.

The other aspect is, we are putting away around 40K a year, with plans to slowly increase that as pay permits. At 18 years from now, I hope to be around 1.8M.
With that, plus wife's school pension, rental income, we can live just nicely on 4% of that 1.7M a year. (between 1.7 and 1.9 is the goal)

If something were to happen and one of us spends 13 years of that timeframe unable to sock away retirement money, I want the other to still achieve it. So if one us essentially couldn't put any away, but an extra 700K went in our retirement accounts (estimating 6.5% annual growth) we'd meet that goal.

I just ran a quick number. Looking at 18 years more, at 40K a year invested at 6.5% annual. Says in 5 years we'd be at around 400K from where we are today.
If suddenly at that time, an extra 500K went into the retirement accounts, and ZERO more was put in, in 13 additional years, it would be worth 2M.
So, again, meets the goal.
I reran it at 3 years from now. assuming we were whereever we were at 3 years, something happened, and 500K went in, compounded at 6.5% annually, and it reaches 1.95M. So still meets the goal. So, I guess maybe 500-550K is what we really need to meet the goal.



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www.selectquote.com

I got pay $395/yr for a $500k term like 30 thru TransAmerica.

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RhizzleBop said:    Well, I havn't attempted hard math on this yet, but a 500K policy will run in the ballpark of $46 a month, and 750K runs $63. (Broker estimated me, and said proportionally my wife would be cheaper cause women live longer)

As indicated earlier, check out term4sale.com for better quotes. I am sure you can do better than what your Northwestern Mutual agent gave you.
It is better to compare annual premiums. Most companies have a fees for monthly payments and they can be different for different companies. Comparing annual premiums and paying them annually is the way to go.

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RhizzleBop said:   
jerosen said:   
fwuser12 said:   
RhizzleBop said:   
jerosen said:   Assuming you both participate in social security, don't forget to figure the survivor benefits your kids will get. It usually a fair amount of money.
Not tracking how I would figure that or when it would become effective.

Go to ssa.gov
Create an account and you should be able to view your SS tax contributions and benefits.


Yeah that will give you the estimate of benefits. Its probably in the $1200-1800 ballpark monthly per kid.

If you pass away your children get survivor benefits from social security. They get that benefit monthly until they hit age 18.
The money is for the kids but it can be used to support their needs (food, housing, clothing, medical, recreation, etc).

Well, somehow I just missed this, and wasn't thinking about it.
Good to know. It would certainly help my wife, or myself maintain our childrens lives with an extra 2-3K a month. (though if its like retirement social security, you get about a .5% increase every other year so inflation eats you up.

Good to know. Adds to the confusion of the calculation.


Yes the survivor benefit gets a COLA similar to SS retirement.

The SS COLA is based off the inflation figures. Its calculated a bit differently than the typical CPI but its not far off. In the past 20 years the rate is up ~2.1% average.


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fwuser12 said:   
RhizzleBop said:    Well, I havn't attempted hard math on this yet, but a 500K policy will run in the ballpark of $46 a month, and 750K runs $63. (Broker estimated me, and said proportionally my wife would be cheaper cause women live longer)
As indicated earlier, check out term4sale.com for better quotes. I am sure you can do better than what your Northwestern Mutual agent gave you.
It is better to compare annual premiums. Most companies have a fees for monthly payments and they can be different for different companies. Comparing annual premiums and paying them annually is the way to go.


Yeah term4sale seems to run closer to $40-50/month for 750k for someone in their mid 30's.

Of course the exact cost will depend on the individual health status but you seem in generally good health.


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RhizzleBop said:   
The idea of around 750K, is that in the event something happens to one of us, obviously family investment savings would drop dramatically and this would go into investments, left to grow the remaining years until early retirement.




That $750k policy replaces 8 years of your income, or 11 years of your wife's. Can your family continue the same trajectory if you/your wife "retires" outside of that timeframe? You say 18 years is the current retirement plan, so if you redeem that policy sooner than later (during the first 10 years verses the last 10 years), it sounds like you'll come up short.

One idea to look at would be supplementing those 20-year policies with similar (and cheaper) 10-year policies. That helps better protect your family during the young, more expensive child-raising years, but not make you pay for the extra coverage once you've had another 10 years of saving and plan to work less than 10 more years anyways. It may also prove cheaper to just increase the 20-year policy limit, even though you wont need that much in the later years.

rated:
I'll def be checking out that site. Just trying to figure out what product and amount I should even be shopping for. If it could be had down around 40-50 a month for 750k. Then ts possible me and my wife could be somewhere under 80 bucks a month for BOTH of us to have 500k each in the event something happens and that when handled correctly ensures we are able to meet our early retirement goals if something did happen.

I'm fine with paying it annually. No matter to me. The guy just gave me numbers monthly. Itrelavent to me.

Basically around a grand a year for 20 years and by that time or even at 18 years. If we reach our goal and retire I stop paying for the policy. Poof. We're done w it. So 18k to nearly eliminate the risk. Like I said. This topic has come up to to recent relative issue of her and it got me thinking hard about what if.

Thanks for the advice. I'll heck that site out for sure.

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RhizzleBop said:   I'm fine with paying it annually. No matter to me. The guy just gave me numbers monthly. Itrelavent to me.

They quote monthly premium for a reason. For the vast majority of folks, $50/month sounds lot more affordable than say $550/year, even though there is ~10% fee in the monthly premium.
Not different than some of the TV ads that tout "... you can get coverage for under a dollar a day...", with no medical exam etc.

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RhizzleBop said:   

Well, I havn't attempted hard math on this yet, but a 500K policy will run in the ballpark of $46 a month, and 750K runs $63. (Broker estimated me, and said proportionally my wife would be cheaper cause women live longer)



Except you need far more than that because of inflation

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RhizzleBop said:   Well, I havn't attempted hard math on this yet, but a 500K policy will run in the ballpark of $46 a month, and 750K runs $63. (Broker estimated me, and said proportionally my wife would be cheaper cause women live longer)
I looked at that and said, well 46 and just 18 more (less than half) adds half to the policy. Clearly more number crunching is required.


Figure out what your needs are based on liabilities and/or loss of income (consider the impacts of both inflation and reduced expenses), then get quotes for that. It doesn't make sense to look at this based on the cost effectiveness of the policy before you even know how much coverage you need.

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doveroftke said:   
RhizzleBop said:   Well, I havn't attempted hard math on this yet, but a 500K policy will run in the ballpark of $46 a month, and 750K runs $63. (Broker estimated me, and said proportionally my wife would be cheaper cause women live longer)
I looked at that and said, well 46 and just 18 more (less than half) adds half to the policy. Clearly more number crunching is required.


Figure out what your needs are based on liabilities and/or loss of income (consider the impacts of both inflation and reduced expenses), then get quotes for that. It doesn't make sense to look at this based on the cost effectiveness of the policy before you even know how much coverage you need.

That is exactly what I'm doing, if you read up a few posts.

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ellory said:   
RhizzleBop said:   

Well, I havn't attempted hard math on this yet, but a 500K policy will run in the ballpark of $46 a month, and 750K runs $63. (Broker estimated me, and said proportionally my wife would be cheaper cause women live longer)



Except you need far more than that because of inflation


Yes, above I ran a couple scenarios where I assumed our yearly contributions stopped, and alump sum of 500K went into the account and grew for the remainder of 18 years, and it seemed to work out about right.

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gnopgnip said:   How did you come to the 750k figure, and why not 250k or 500k?
If you're gonna knock off the spouse, think big. $1M, $2M or even $5M, but you'll have to pay the premiums a good long time to make it look legit before the "accident" happens.

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Glitch99 said:   That $750k policy replaces 8 years of your income, or 11 years of your wife's.
It actually replaces WAY more than that. Remember that life insurance payoutsare tax free, while their salaries are taxable. Further, a lump sum payment gets invested and earns interest and dividends, so it is worth significantly more than the aggregate amount of your salary over X number of years. He also needs to take into account the fact that when a person dies, the expenses associated with that person go away, so a life insurance payout ends up going a lot further.

rated:
OP, term4sale.com, which is based on Compulife's excellent software, is a great website to run the numbers. As people have appropriately cautioned you, however, you really just don't know how much your premiums are going to be, as you don't know what health rating you and your wife will qualify for. Remember thatthe vast majority of the ultra-preferred policy holders would not have qualified for ultra-preferred with every life insurance company out there. So, although term4sale.com will give you a general idea of the pricing, you should never blindly apply for a policy with any company. Instead, you need to work with a goodindependent broker who has access to all these companies (it won't cost you a penny extra) who can go over your health and other records and recommend the best company to apply with. Most people out there just do not realize the impact that certain factors can have on life insurance underwriting and are surprised, for instance, when more than 2 moving violations in the last 3 years adversely affect their life insurance quotes, as it never even occurred to them that their driving records influence their life insurance offers.

All life insurance companies out there ask about the family history (they usually ask about natural parents and siblings) of cancer, heart disease and any cardiac-related condition. Breast cancer does unfortunately have a genetic predisposition (as well as colon, prostate, ovarian, etc...), so they will all look at it closely, but depending on the particulars, different companies are very likely to come up with different decisions. This is all the more reason to work with a goodindependent broker and to avoid blindly applying with life insurance carriers.

P.S.
In your OP you mentioned Northwestern Mutual. It isgenerallynot a good carrier when it comes to term life insurance, as ithas very conservative underwriting and its term life premiums tend to be higher than those of othercarriers that compete in this space. Northwestern Mutual's bread and butter is permanent life insurance, not term.

Also, the auto insurance carriers, which also offer life insurance, tend to have very conservative underwriting (they just don't have the volume of life insurance cases that the companies that specialize in life insurance receive, so they tend to play it very safe) but also tend to be fairly expensive. The two exceptions that I can think of are USAAand Cincinatti, which both do have very conservative underwriting, but also have competitive premiums in the ultra-preferred space. Cincinnati's premiums are part of the Compulife engine, so they'll be displayed by term4sale.com

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amd555 said:   www.selectquote.com

I got pay $395/yr for a $500k term like 30 thru TransAmerica.

Selectquote just takes your info and sends it off to a rep who then tries to sell life insurance to you. In other words, it's not any different from blindly calling up alarge insurance agency and asking for a quote.

term4sale.com on the other hand, allows you to run different quotes without providing your contact information. You can then contact the agent of your choice, who does not have to be affiliated with term4sale.com.

rated:
So, plugged in some values and as accurate a history and personal data as possible on term4sale.

For 500K got $317 a year for my wife, and $366 for myself for 20 yr term.

Going to 600K bumped to $360 for my wife, and $421 for me.

So, we're looking at between $700-$800 a year to get what it appears we need to ensure our family's well being.

Jumping to 30 yr term jumps the cost up to $650 and $700 EACH.

According to my Target plan, I'd prob only need it 18 years.

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RhizzleBop said:   So, plugged in some values and as accurate a history and personal data as possible on term4sale.Have you ever seen a life insurance application? It is far more detailed and comprehensive than the basic questions that you answer on a website to get a life insurance quote. There will also be a health exam and underwriting will pull MIB, MVR and, in certain situations, may also request all your health records.

Hence, although it's good to get a general idea of the pricing and your desired coverage level up front (and each insurance application will ask you how much you're applying for, which is something that you can adjust later as well), you cannot and should not make any final decisions until you apply and get an offer. If you or your wife end up receiving only standard offers, for instance, you're likely to scrutinize your coverage decisions a lot more than if you and your wife both receive ultra-preferred offers.

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geo123 said:   
Glitch99 said:   That $750k policy replaces 8 years of your income, or 11 years of your wife's.
It actually replaces WAY more than that. Remember that the life insurance payout is tax free, while their salaries are taxable. Further, a lump sum payment gets invested and earns interest and dividends, so it is worth significantly more than the aggregate amount of your salary over X number of years. He also needs to take into account the fact when a person dies, the expenses associated with that person go away, so a life insurance payout ends up going a lot further.

It also doesn't account for raises or increased childcare costs of a single parent, and the investment return will be of the low-risk variety. I was ballparking it.

Based on his rough numbers, he needs more than one salary just for day-to-day living, and that's before adding a second baby to the mix. If forced to use a policy in the next 5 years, $500k is not going to adequately subsidize his end game.


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RhizzleBop said:   So, plugged in some values and as accurate a history and personal data as possible on term4sale.

For 500K got $317 a year for my wife, and $366 for myself for 20 yr term.

Going to 600K bumped to $360 for my wife, and $421 for me.

So, we're looking at between $700-$800 a year to get what it appears we need to ensure our family's well being.

Jumping to 30 yr term jumps the cost up to $650 and $700 EACH.

According to my Targetplan, I'd prob only need it 18 years.

With a 30% difference in incomes, why would you pursue equal insurance policies? Are you intending to overinsure her or underinsure yourself?

rated:
37 years old is a sweet spot for a 20 year policy...when I was that old I dumped my insurance through work and got a 1M policy for $45 and got 300K on my then wife for $21 I think. I'm 48 now and once my kids are out of college and in a career I'm going to cancel the policy.

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RhizzleBop said:   
ellory said:   
RhizzleBop said:   

Well, I havn't attempted hard math on this yet, but a 500K policy will run in the ballpark of $46 a month, and 750K runs $63. (Broker estimated me, and said proportionally my wife would be cheaper cause women live longer)



Except you need far more than that because of inflation


Yes, above I ran a couple scenarios where I assumed our yearly contributions stopped, and alump sum of 500K went into the account and grew for the remainder of 18 years, and it seemed to work out about right.

Do it with an assumption of 4% inflation. Then see what that does to your balance (At 4% inflation, after 18 years, the dollar only buys half of what it does today)

rated:
whichever the decision might be, that $64/month sounds pretty competitive for 20 year fixed.

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OOrochiimaru said:   whichever the decision might be, that $64/month sounds pretty competitive for 20 year fixed.
For a 37 year old non-smokerlooking for a $750K 20 year term, $64/mo or $768/year is a quote at standard or standard-plus. If he qualifies for ultra-preferred, the exact same policy would be in the neighborhood of $390-$490/year.

Regardless, he won't know what he qualifies for until he gets an offer and he won't know how to obtain the best offer until he discusses his exact situation with a good independent broker.

rated:
Several companies will not count a family history of cancer against you. A good independent agent will know which ones. Regardless of family history, if your wife has one of the genetic markers for breast cancer risk (BRCA, etc), it could affect her rates. Companies do not test for this, but it may be in the medical records they get from her doctor.

Northwestern Mutual is only competitive if you're a smoker. Otherwise there are many better companies.

While term is the recommended play, considering your family histories, be mindful of conversion options while shopping. If your health does change in the future, you might want to continue coverage longer than you think. You don't want to be in your 50's, fighting diabetes and cancer, still wanting or needing insurance, and stuck with a policy at prohibitive cost.

That pretax life insurance you have through work (if it's actually pretax) will result in a taxable death benefit. Consider that in your needs calculation.

Skipping 46 Messages...
rated:
RhizzleBop said:   
chislands18 said:   
RhizzleBop said:   
chislands18 said:   
RhizzleBop said:   So, I've reached out to a couple independent reps and I think this one guy is doing an excellent job of providing information.

He pointed out that only a couple companies would write a preferred plus rate on me at 6'3 235. Said 236 was their limit.
Also, he noted that if my moms heart attack was under age 60, that would knock me out of preferred plus. (59).

My wife looks prime to get preferred plus and said some companies look at parental history and some look at siblings as well. Would def make a difference for us.

I asked about 500K and 750K,
as well as doing a staggered plan of 150K and 600K at 30 and 20 years in case I want some coverage to run longer than 20 yrs (in case life throws a curveball) so we're not looking for a 10 yr policy at age 57.

He sent me a great little matrix breakdown.
He also said that 250K min was the sweet spot as their rates are basically no lower for 150K than 250K.

So, me, straight 20 yr term at 750K PP $420 yr
me 20 yr 750K P $ 540 yr

wife same terms PP $360 yr

me staggered 250k/30+500k/20 PP $603 yr
me staggered 250k/30 500k/20 P $735 yr

wife staggered 250k/30 500k/20 PP $514 yr

So for both of us straight 750K 20yr at PP were looking at $780 yr
both of us staggered 250k/30 500k/20 PP $1117 yr

If I get bumped to P $1249 yr

Of course, it comes down to doing the whole process and seeing what they WILL rate me at, but this appears to be the range were looking at.

What I don't know is if the staggered plan is really worth it or not. I was thinking just 100-150K, but he seems to think the pricing is such that less than 250 isn't really worth them writing it so the price pretty much goes flat.


I own an independent life/disability/long-term care/health insurance brokerage located in San Diego, CA and am licensed in most all 50 states. I also am listed on www.Term4Sale.comand represent over 60+ different carriers. I am very familiar with life insurance underwriting and always get the best rate for my clients.

As others have mentioned, the beauty of www.Term4Sale.comis that it's fully transparent.With that being said, it's important to note that a lot of agents claim that they are brokers, yet they only work with 3-5 different carriers - You will even run into this with some agents on ww.Term4Sale.com

What carrier is your broker quoting you? Also, are they quoting your rates on an annual, semi-annual, quarterly, or monthly basis. Monthly is the most expensive mode to pay for life insurance, and annually is the least expensive.

I just ran quotes for you and based on your stated age of 37, your H&W of 6'3" 235lbs and your mother's history of a heart attack at age 59, Principal Life would be the least expensive carrier, and your best bet, so long as you can get under 232lbs, and so long as your mother didn't pass away before age 65 due to heart issues. Principal's annual PP rate for $750k, actual/age nearest 37 is $399.23/yr. As I mentioned, this rate is based off of actual age 37, as well as age nearest 37, versus, actual age 37, age nearest 38.

Principal is also one of the few carriers who offers the Healthy Life Credits (HLC) program that others have mentioned, where they will bump you up a health class, assuming there's only 1 knock out factor (ie: build, family history, cholesterol, BP, etc.) preventing you from qualifying for a certain health class. Meaning, if you fit all of the other Preferred Plus criteria, but your build or family history is at the Preferred range, they can sometimes use other favorable factors (ie: BP, cholesterol, pulse, weight, family history, routine physicals, etc.) to bump you up to the better health class.

Questions:
1. Are you actual age 37, or 6 months closer to your 38th birthday?
2. You mentioned that your mother had a heart attack at 59 - Did she pass away at age 59, or is she still living? If she's still living, is she older than age 65?
3. Are you 6'3" and some change, or a true 6'3"? If 6'3.5", they will bump you up to 6'4", which would bring other carriers into the mix.

If your mother DID indeed pass away due to heart issues prior to age 65, I would recommend that you get under 232lbs before you take your exam, as Principal will use their HLC program in order to bump you up to PP, assuming you meet all of the other PP criteria. If your mother is still living and DID NOT pass away before age 65, then you wouldn't have to worry about your weight being 235lbs, and you should again be bumped up to PP, assuming you meet all the other PP criteria.

Keep in mind, that your BP or cholesterol may be elevated and could knock you out of the PP health class either way, so you don't know until you actually run your labs. If it were me, I'd try to get under 232lbs before the exam in order to "hedge" my bets, as the HLC could bump you up to PP, assuming your BP or cholesterol comes back in the Preferred category.

Confusing, I know, but it's just a matter of knowing all of the carrier guidelines and trying to get all of the data that you can control upfront. There are many people who overpay for term insurance for 20-30 years, when they could have just been more methodical and well-versed with each carriers underwriting guidelines. A good broker will walk you through all of these details in order to get you the best policy/rate available.



The prices he quoted were of course "ideal" best and he clearly noted that nothing is final, nor am I obligated until the physical results and all that are finished.

My numbers were quoted from American General
My wife's numbers were United of Omaha and Cincinnati Life depending on the diff variables he played with.

I turned 37 in jan. My wife turned 37 in feb.

my mom is doing well now at 72.

I'm right at 6'3", not more than.

I'm right now between 233-235 depending the time and shoes or no shoes.

My BP has always been fine, right at 120/80 or lower sometimes.

My cholesterol is strange. The total is good, but my ratio is bad. The good number has been running low, like in the 30s when it should be around 60 with a min of 40. I've been trying to correct that and don't have any datapoint on its imporvement since Oct 2015.

MY feeling from talking with this guy is that he does know to fish it to a bunch of people based on the numbers, and I think, once the numbers are all in, he'll fish further if he needs to. He never specifically mentioned the carrier you did, but i can ask. He did mention a lot about the other variables, and even said sometimes they will "weigh things into consideration". So, maybe thats the "leeway" for one bad datapoint you mentioned.

I'm probably gonna setup a time this week to sign papers and get the ball rolling. He said if the results come back and we don't want to move forward with purchasing that we're not obligated. I don't see how they could do physicals, and not expect a policy or reimbursement but thats what he says.


As for the policy plan, the more I think about it, the more I'm thinking of just the 20yr term at 750K each.
I considered the staggered plan, but the more I think about it, by that point, I plan to be self insured essentially. Well, even if life throws a curveball with regards to investments and we aren't fully retired and something happened at yr 21 or 22, that doesn't mean I NEED 750K, that just means I may still be working, with the house nearly paid off, and kids college either finished or well underway with little left to pay.

I'm having a hard time recognizing a legit scenario where I need that kind of insurance for another 10 yrs.

Let's say at yr 22, we're almost ready to retire (running 4 yrs behind the plan), and somehow the house still has 50K owed.
Well, it means the one of us remaining would need to pay for final costs, and maybe need to pay for 1 more yr of college, So say it's 150K.

Well if were at that point, around 1.8m in investments and 2 paid off rentals earning income, I'd think we'd just write that check, chalk it up as a life event, deal with it, and move on towards retirement. Not seeing a need for a 250K payout, that we're still paying for another 10 yrs.


Plus, I'm looking at around $775 a yr for the (2) 750K policies for 20 yrs, vs around $1120 a year for the 250/500K 30/20yr staggered policies. Its basically another $350 a year, and I'm just struggling to see a valid reason.




American General will definitely NOT be the best carrier for you, as you will automatically not qualify for their PP rating, due to your mother's history of heart disease at age 59. Because of this, American General will automatically bump you down to their more expensive Preferred, when there are other carriers who have a better "A+" AM Best Rating (American General has an "A" AM Best Rating), who will also be less expensive (SEE ATTACHED RATES). A very rookie mistake that brokers sometimes make, as we always try to field out the best carrier and pricing for you, based on the factors that we can control and what we already know (ie: H&W, family history, driving record, travel history, BP, cholesterol, etc.).

Although American General's Build Chart will allow you to go up to 236lbs, given your height of 6'3", American General's Crediting Program is only available for applicants who are older than age 41, therefore, your family history will preclude you from PP rates. At 6'3", assuming you can get under 232lbs, you will be a shoe-in at PP with Principal Life, as they have a more lenient family history criteria. Meaning, with Principal, you are PP for both H&W and family history, whereas, with American General, you're at a PP for H&W, and a Preferred for family history.. American General will rate you at Preferred, which is more expensive times 20yrs. With Principal, you're basically hedging your bets, as they are the ONE OF THE ONLYfew carriers who will allow you to get to the best PP rating. Not to mention, Principal is also cheaper than American General for their Preferred rating as well, along with having a better "A+" AM Best Rating.

Below is American General's underwriting criteria for Family History, per their published Underwriting Guidelines. Keep in mind, life insurance carriers typically do not deviate from these guidelines unless they have some other Crediting Program that they offer, as they have reinsurance treaties that they typically have to adhere to:

American General's Family History Criteria (here's the direct link to American General's UW Guide - All figures taken from Page 8 of 27 (Family History) -https://estationsecure.americangeneral.com/SharedFilePile/AGLC101638.pdf​):
Preferred Plus -No coronary artery disease or cancer prior to age 60 (parents only)
=9ptPreferred -No death due to coronary artery disease or cancer prior to age 60 (parents only)

As I mentioned, Principal will be the best carrier for you, so long as when you complete your medical exam you're under 232lbs, as you will be in the PP category for both your H&W, as well as your family history - Per Principal's published Underwriting Guidelines, they are more lenient with a family history of cardiovascular disease. Also, if after completing your medical exam your HDL Cholesterol Ratio comes back worse than expected and in the Preferred category, then Principal's Healthy Life Credits (HLC) will allow you to then get bumped back up to PP, rather than be stuck at Preferred rates for 20yrs.

Principal Life's Family History Criteria (here's the direct link to Principal's UW Guide - All figures taken from Page 37 of 44 (Family History) - **See page 11 of 44 for full info on HLC Program -https://advisors.principal.com/publicvsupply/GetFile?fm=BB10009&ty=VOP&EXT=.VOP):
Super Preferred (aka: Preferred Plus) -No death prior to age 65 of: Cardiovascular Disease Breast Cancer, Colon Cancer, Ovarian Cancer, Prostate Cancer, Diabetes
=9ptPreferred -No death prior to age 60 of: Cardiovascular Disease Breast Cancer, Colon Cancer, Ovarian Cancer, Prostate Cancer, Diabetes

With regard to the cholesterol issue, most carriers want your HDL Cholesterol Ratio to be under 4.5 or 5 in order to qualify for their top PP rate. They also look at your total cholesterol as well and want it to be anywhere from 220 to 300. Do you happen to know your HDL Cholesterol Ratio, or at least your Total Cholesterol and HDL Cholesterol figures?

Just so you know, your HDL Cholesterol Ratio is determined by the following: Total Cholesterol HDL Cholesterol = HDL Cholesterol Ratio

SEE ATTACHED RATES in order to see the exact figures as to why American General would not be your best bet here. The broker that you're speaking with might not represent Principal, which is why I work with mostly all of the carriers on www.Term4Sale.com.To be honest, there are many brokers who don't know the ins and outs with UW, which can really cost the consumer a lot of money in the long run. It's a matter of knowing your industry. Thanks!



Thanks for the great info!
I'll def check into this prudential.

As for my numbers. I found my old numbers from 3 yrs ago, and roughly recalling from that how much they improved the last couple years I think I Know where I'm about at.

Total Cholesterol was 173 then. I think its still around 170-175
HDL was 33 3 yrs ago. I recall I got this up to 36, and hopeful it it over 40 now.
TC ratio was 5.2. I think is still right at or over 5.

LDLD was 121, not sure now. prob similar.

Glucose was 97, but last year it was 92.

BP 3 yrs ago was 120/82.
I think last year it was 120/78.
I've also seem 178/80

BMI runs around 29-30

They had listed me as 6'2", but I've also been measured at 6'3" go figure.

I'm trying to get myself under 232. If its done without shoes I think I can get there.

I strongly suspect that he didn't mention these guys becasue I told him I was 235.
That conversation went as far as to say, don't be over 236 or AG will not qualify you for PP.
He didn't tell me the next low number to reach.


No problem - I've helped many FWF with life insurance, so I'm always happy to help!

PRINCIPAL, not Prudential will allow you to get to the PP rate, and will be the least expensive carrier. As you will notice by the previously attached quotes, Prudential's Preferred Best rate (aka: PP) was more expensive than both Principal and American General's Preferred rate, but I just included both Prudential and Lincoln National on there in order to show you the pricing spread for comparison purposes.

As you may already know, most carriers call their best health class Preferred Plus Non-Tobacco (PP), but some carriers use different names for their PP class (ie: Super Preferred, Preferred Best, Select Preferred, Preferred Elite, etc.), and I think most use different names in order to confuse the consumer.

With regard to your cholesterol, your total will need to be under 240 and your HDL Ratio will need to be under 4.5 in order to get PP with Principal. Since your cholesterol is well under 240, and your HDL Ratio looks to be over 4.5, that will put you at Preferred with Principal, BUT with HLC, you should be bumped back up to PP, due to your BP, family history, build, and pulse all being controlled and favorable. Just so you know, Principal's HDL Ratio cutoff for their Preferred rate is 5.5, so it would need to be under 5.5 in order to get the bump up with the HLC. As you mentioned, the figures that you provided were 3yrs old, so that could obviously be different now (better or worse).

I'm telling you.. I've been in this industry for a long time and we have over 5k clients all across the nation. We put a ton of business with both American General as well as many other carriers and American General is a great company, but not the best in your situation. I'd be VERY surprised if American General were to give you their PP rate, due to your mother having cardiovascular disease before age 60 - You can read it right there in their published guidelines, that the family history with American General would be a knockout of their PP rating, in which, they'd approve you at Preferred. This is precisely why I wouldn't apply with AG out of the gate and would go with Principal. Also, as others have mentioned, some carriers are more lenient with cancer family history (ie: you being a male and your mother having ovarian cancer, or you being a female and your father having prostate cancer), but they're pretty staunch with cardiovascular family history.

Here's the math with exact numbers, which you may have already done...

$750k 20 Year Level Term:
Principal's PP Rating - $7,984.50 in Total Premiums Paid Over 20yrs
American General's Preferred Rating - $10,430.00in Total Premiums Paid Over 20yrs (+$2,445.50 in unnecessary extra premiums)
Principal's Preferred Rating - $10,155.00 in Total Premiums Paid Over 20yrs (+$275 in unnecessary extra premiums)

As you will notice, despite you not being able to qualify for the PP rate with American General, they are also more expensive (albeit, not by much) than Principal's Preferred rating. But tell me, why would you want to go with American General when their Preferred rating is still more expensive than Principal's, which you could easily qualify for? Your broker should have mentioned Principal, but he/she didn't. Not to mention, Principal's Financial Ratings are stronger than American General/AIG's -If your current broker doesn't represent Principal, then I would just check with another broker, or PM and I'd be happy to help.

Financial Ratings:
Principal - "A+" AM Best Rating, 90 Comdex Ranking
American General - "A" AM Best Rating, 82 Comdex Ranking

You may consider trying to get your Total Cholesterol down with diet/exercise, or try to get your HDL levels up, if possible, as that will improve your HDL ratio. Check out this link - http://www.healthline.com/health/high-cholesterol/foods-to-increase-hdl#4.You could also just go on a statin drug for 6 weeks prior to getting your exam completed, which would then get your cholesterol to normal levels, but many people don't want to do this (myself included). With Principal as it stands now, you should be able to get bumped up to PP, so this probably won't even be necessary.

Finally, lets say you apply with Principal and your HDL Ratio is off the charts (over 5.5), therefore, you qualified at their Preferred rate, via HLC, though you were technically Standard Plus. You could always go on a statin for a 6-8 wks and get your cholesterol levels down, and then try to replace that policy a year later and lock-in a lower PP rate with another carrier. Many people don't know this, but you can save thousands of dollars over the 20yr term, by being methodical and smart about it.

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