Whole life ? (financial, investing, account, annuities)

[okaydorothy]

My dh has had a whole life policy for about 14 years now. It costs about $500 per month and it is worth about $80,000 now. The value of it is $750,000.

My question is would it be better at this stage to cash it in and just open a term life policy for about 20 years. He is in his 40's, we have two children and are 10 years away from college.

I know whole life isnt the way to go, but he opened it when we were much younger.

Thanks in advance.

[sunsprit]

Best to sit down with your insurance agent, financial planner, and accountant to answer to insurance questions for your individual situation.

In the general sense, using insurance for an investment vehicle has been a poor performer compared to simply purchasing term life to fit your anticipated financial worst case scenario and then investing the rest of the money.

Lately, certain insurance investment policies -- annuities --- have been the "hot" product of the industry. They're heavily marketed, and the insurance industry knows how to push the marketing buttons to generate sales (and nice big fat commissions for the agents). I have no doubt that when the "buzz" dies down for these programs, they'll be replaced with something else ... as we've seen with other insurance investment plans through the last few decades.

You need to be a well advised purchaser to determine if these programs are for you .... there's risk vs reward in all forms of investment. Your insurance agent will only show you their side of the equation.