whole life insurance numbers

Financial Planning - Financial planning in general. (Moderated) 

  Yahoo!   Google   Windows Live   del.icio.us   digg   Netscape

Subject Author Date whole life insurance numbers P.Schuman 11-13-2006  Re: whole life insurance numbers Cal 11-13-2006  Re: whole life insurance numbers joetaxpayer 11-13-2006  Re: Whole life insurance vs Term + investing P.Schuman 11-13-2006  Re: Whole life insurance vs Term + investing Cal 11-13-2006  Re: Whole life insurance vs Term + investing P.Schuman 11-15-2006  Re: Whole life insurance vs Term + investing Cal 11-15-2006  Re: Whole life insurance vs Term + investing joetaxpayer 11-15-2006
Posted by P.Schuman on November 13, 2006, 5:02 am A neighbor has $100k in whole life, and has had it for several years. (We were chatting about our 16yr olds & college savings) As I recall, these policies are basically "forced savings" with the death benefit tacked on. Any comments on his policy numbers that I copied below ? $104,000 basic whole life $2,000 yearly premium x 15yrs = $30,000 paid into policy $138,000 current value $34,000 total from dividends $4,767 current year cash value increase $1,935 current year dividends Posted by Cal on November 13, 2006, 2:01 pm > > As I recall, these policies are basically "forced savings" > with the death benefit tacked on. > > Any comments on his policy numbers that I copied below ? > > $104,000 basic whole life > $2,000 yearly premium x 15yrs = $30,000 paid into policy > $138,000 current value > > $34,000 total from dividends > $4,767 current year cash value increase > $1,935 current year dividends As you can see, from the numbers that you have posted, the Current Interest is almost equal to the current cost. However, you neglected to show the Current Increase In Cash Value. Each year there is an Increase in the Cash Value in addition to the dividend. Therefore, the TOTAL value INCREASE of the contract will EXCEED this years cost. To have had coverage of 100K for 15 years, and at the same time to show an INCREASE in the Cash Value of over 100k seems to be too high, but if correct it is FANTASTIC....... Cal Lester CLU the Posted by joetaxpayer on November 13, 2006, 2:35 pm Cal wrote: > > > >>As I recall, these policies are basically "forced savings" >>with the death benefit tacked on. >> >>Any comments on his policy numbers that I copied below ? >> >>$104,000 basic whole life >> $2,000 yearly premium x 15yrs = $30,000 paid into policy >>$138,000 current value >> >>$34,000 total from dividends >> $4,767 current year cash value increase >> $1,935 current year dividends > > > As you can see, from the numbers that you have posted, the Current Interest > is almost equal to the current cost. However, you neglected to show the > Current Increase In Cash Value. Each year there is an Increase in the Cash Value in > addition to the dividend. Therefore, the TOTAL value INCREASE of the > contract will EXCEED this years cost. > > To have had coverage of 100K for 15 years, and at the same time to show > an INCREASE in the Cash Value of over 100k seems to be too high, but if > correct it is FANTASTIC....... > Cal Lester CLU OP said current cash value increase is $4767. $138K current value I read as $100K death benefit, $38,000 cash value. If in fact the cash value were $138K, the annual return on the $2K/yr would be over 15% per year. Very unlikely. Do you read this differently? JOE Posted by P.Schuman on November 13, 2006, 4:02 pm from my scribbled notes, the policy death benefit is $138k the policy cash value is $46k $4767 cash increase this year $1935 2006 div $2000 yearly prems for 15yrs So - for your invested $30k, you get $46k (over 15 yrs) plus purchased death benefit. Wonder how the classical comparison looks of invested a portion of the $2000 + buying a Term policy... I think my Term is $500 per $125k of coverage. Any general comments I can take back to him when I see him at swim team... Posted by Cal on November 13, 2006, 4:58 pm > from my scribbled notes, > the policy death benefit is $138k > the policy cash value is $46k > > $4767 cash increase this year > $1935 2006 div > > $2000 yearly prems for 15yrs > > So - for your invested $30k, you get $46k (over 15 yrs) > plus purchased death benefit. > Wonder how the classical comparison looks > of invested a portion of the $2000 + buying a Term policy... > I think my Term is $500 per $125k of coverage. > > Any general comments I can take back to him > when I see him at swim team... This is more reasonable. As you can see from your new figures, there was a RETURN on your $2000 of premium for this year ALONE of $6702 PLUS having the insurance In-Force. Next years reurned should in all probability be even higher. Cal Lester CLU > Similar Threads Posted Life insurance in 401(k)-PSP November 29, 2006, 11:53 am Do I need life insurance? October 31, 2007, 5:15 pm Life insurance exclusions November 10, 2006, 2:03 pm Term Life Insurance November 13, 2006, 2:01 pm Re: Life Insurance Annuity August 13, 2007, 3:50 pm "Paid Up" Whole life Insurance August 25, 2007, 7:50 pm Term Life Insurance October 1, 2007, 2:33 pm Life Insurance Beneficiary November 3, 2007, 6:55 am Life insurance ownership November 14, 2007, 3:24 pm Life Insurance Options January 14, 2008, 7:18 pm