Don’t keep a policy like Sharon’s that keeps increasing in cost. Get term life insurance:
SUMMARY
In this video, Dave speaks to Sharon, a 68-year-old woman in Sarasota, FL. She bought a universal life insurance policy 20 years ago and is now struggling with whether she should cash it out or not.
With universal life insurance (which is just a type of cash value life insurance), a portion of your premium goes towards paying an insurance cost and goes up every year because it is based on annual renewable term rates. Each year, more goes towards insurance costs and less goes toward your investment.
Sharon and her husband have recently been notified that their payments were going fully towards the insurance cost, with none left over for their investment value. Plus, in the next two years, they will have to start paying more to cover the increasing insurance cost. Since Sharon’s husband has now battled cancer twice, she is wondering whether they should cash out their policy now or increase their payments to ensure they are covered in the future.
Dave recommends that Sharon keep her policy for 2 more years until her insurance company is going to make her pay more per month. Then, she should check on her husband’s health, and if he’s still cancer-free, she should drop the policy. If her or her husband’s health is not well at that time, she should keep the policy and pay whatever it takes to keep them covered.
RESOURCES
Hear more of Dave explaining why term life is the only type of life insurance you should have:
Learn the real truth about life insurance here:
Thinking of switching to term life insurance? Read these term life mistakes to avoid:
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