Life insurance: what to do?

My life insurance is up for renewal this month. It’s a plan I carried over from my previous employer. At the time I set it up I didn’t really think much about it and I just did about the minimum. I am curious how you guys structure your life insurance? How much coverage? What about life vs AD&D? How much in each?

Also do you have any good life insurance company to recommend? I did all my insurance with State Farm except life insurance. I don’t even know if they sell life policies.

Rich dad doesn’t need life insurance.

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One thing I am reasonably sure is not to mix investment with insurance. So I tend to avoid policies with investment wrapped into one. My parents have one of those, and the investment never pans out like the agent promised.

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If I had 10M net worth I won’t need life insurance. I am not there yet unfortunately…

When I was poor dad, I did not have excess money to buy life insurance.
When I am rich dad, FI reached, I do not see any need to buy life insurance.
On both cases, I left it with with company mandatory 2x insurance!

Personally, I don’t have life insurance. Wife is a professional who can support herself if I die. Plenty of emergency funds. If you have a stay at home spouse and kids, maybe get enough to replace your income through kids college. Maximum get 25x your expected annual expenses.

AD&D is a better proposition because dying doesn’t really cost that much compared to being crippled. You need a LOT of money if that happens and no way to earn.

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If you decide to get term life insurance, don’t get it thru work. They usually have a flat rate that is bad for folks with good health. If your health is so bad others won’t insure you, then you go for the ones offered thru work.

I went to seminars where they sell insurance and retirement. Those salesman are aggressive. And they don’t think about what you need, but rather what you can afford. Not for me.

I’d get term life if you need a safety net.

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We have life insurance for both of us. I calculated it roughly to pay for school and room/board for the kids if we both died, though we have no will, so likely the kids would just get money at 18. It should cover college at the least.

I maxed out my amount by virtue of being unemployed.

Did a more for my husband–not as much as I’d like if he died, but better than nothing.

We did a 20 year term because we figured it was only necessary to get the kids through to college.

We’re with USAA, but you have to be either a veteran or have a parent who is.

Yeah… I never quite understood this–doesn’t it go away if you get sick and are laid off? Seems like you’d want insurance that is independent of your job.

Thanks for all the good information. It helps clear my thinking on how long and what type of coverage I want to get. So maybe 20 years is enough for me, as my kids will already be adults and can (hopefully) fend for themselves. AD&D needs to be beefed up. Losing a limb is no joke.

It also opens my eyes that some folks go about without any life insurance. Before I always thought everyone has some coverage. I guess when my kids are all grown up there is little reason. My wife though has this theory that we should at least leave enough money to have funeral for ourselves, without burdening the kids. I assume it’s not some ridiculously luxurious funeral and thus should not cost much.

You can prepay for funeral costs, like with the Neptune society, that is what my parents did…

I ordered 2 books about estate planning and living trusts from Amazon this afternoon. I promise myself I will get that thing set up before end of this year. :slight_smile:

For people who already have put properties into living trusts, do they offer identity protections? I mean, if I put my house into a trust, will a title search still reveal I am the owner? I want to keep lawyers’ dirty hands off my stuff…

Interesting… but we Chinese have a lot of taboo on death. Buying life insurance and having a will is about the farthest most people are willing to go… :slight_smile:

Times have changed. My mom bought a place in a cemetery next to my father.

IMO, getting books is to educate our self. Title Search gives Trust is the owner as you will provide quit claim deed to trust. You (and spouse) will be managing trustee or the trust…etc. Still legally you can get tax deduction and 500k capital gain exemption allowed by IRS.

The law is too complex and LT lawyers are cheap at $500 or less. Better not to avoid lawyer.

I put my properties into living trusts and have to keep the name of my trust the same as mine in order to avoid property tax reassessment. I am still not sure whether you could hide your assets even if you choose a different trust name. If you want protection, you better create a LLC for your assets.
The lawyers’ dirty hands is actually looking for people not knowing the laws and exploit them when there are subtle mistakes on the Living Trust. So I agree with @Jil, it is wise to save your time and find a cheap and trust worthy lawyer to do it.
My term life insurance mainly is to cover my home mortgage (and hopefully part of my rentals too), so the house is paid off when I die and my family do not need to worry about mortgage payment. For the same reason, your living trust will make your wife’s life a lot easier when you die prematurely. Just make sure you name a trust worth relative (like me :grin:) as your Successor Trustee.

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I will hire a lawyer to do the actual paperwork. But I want to be a bit more informed too. Many lawyers also just give people boilerplate docs and don’t bother to customize for their clients.

Did I say I want to keep lawyers’ dirty hands off? I meant to say keep lawyers AND relatives’ dirty hands off. HAHAHAHAHA

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Jill and Manch,

There are many different kinds of trusts. Typical is a revokable trust which is what most middle class people use for their estate planning. Books, google and a lawyer will provide details on what kind of trust you need.

Setting up the trust is fairly easy and can be done via software on through Nolo and similar. Putting property into the trust can be done on your own. If you have a mortgage you will need to have their permission to put the property in the trust. A quit claim deed can be filled out and filed to put the property into the trust.

I recommend a no fee checking or savings account be put in the trust for the executor. Upon death funds from selling property in the trust must go into the trust. Disbursements are from the trust. Its a detail that helps the executor.

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We have life insurance purchased eons ago to insure that the kids would get through college if one/both died. Then we got life insurance in case both died to cover the cost of raising the kids by the people named as their guardian. Then there was more so that the surviving spouse would not have to work for many years and enough to pay of the primary home. While work provides life insurance we purchased what we needed. Can’t count on employers at some future time.

Life insurance allowed me to sleep. :slight_smile:

Not everyone needs life insurance.

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Yes, I have Revocable trust. In addition, lawyer created pour over will, medical emergency options.

Pour over will → If new assets are purchased and not funded in trust, this will help the assets to be added in trust (after court review)

Medical options → We are the trustee, but medically incapacitated to take any decision, it assigns someone to take decision on behalf of us

Lawyer wrote Trust, two wills (husband and wife) and two Medical options…etc a big book. All these are standard copy and paste for a lawyer, but for us this exercise was new.