Cashing out insurance (move, years, payments, family)
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
My parents bought one of those policies that were meant to bury your child if they died. I think there were sold by or affiliated with Gerber? My parents gave me the policy since I didn't die. It was for 10K and I sold it for 1K.
Yes, I have personally done this. It depends on the policy. Some are meant to build value and provide insurance. We bought one of those years ago without much experience or advice in investing. We later learned that you can do much better by separating investments from insurance, buying term insurance and putting the investment money in other accounts. We cashed in and got most of it back, but that account was set up with that as the eventual aim. When I got out early, I overpaid for insurance at that age and the fees for managing the account were comparatively high (and would have remained so).
They are not talking about getting the cash value from the insurer. There are 3rd parties that buy policies for pennies on the dollar
Since they said cashing out, I thought they meant cashing out as opposed to selling. But I haven't seen any commercial. It does seem unlikely that any insurance company would run an add encouraging you to stop over paying them for insurance and high management fees.
I have a $50K policy that, last check with the company, I could cash out at $15K. My ex bought it back in the day (1990 or so).
I think about cashing it in now and then and just be done with the monthly payments. Go prepay a simple funeral I want and take myself out to a nice dinner. Think the money will be better spent.
Can't quite pull the trigger even though kids are grown and I have no need for life insurance at this point. Am preparing to sell house and move to a condo, so I may do it then when I am settled in my new place.
We contacted them before we let our term, with two years left on it, lapse. They are only interested in buying policies from very ill folks. Obviously, there must be a good chance that the person will croak before the term is up.
Has anyone done this and if so, do you get a significant amount back?
And there are other surprises.
Example: for some strange reason when dad died mom gave power of attorney to a brother, who promptly moved (no financial skills) to cancel, among other things, a child insurance policy on ME with mom as a beneficiary. It had been held since I was born. I didn't even know it was still current, as it was self funded.
The "value" was about 58,000. First, you have the huge discount from the insurance company, which dropped it to 38,000. Then, there's taxes. Dropped to 28,000. Then AS USUAL, there 's a surprise of some kind that the agent forgot to tell you about: a fee, assessement, some level of govt. wanting THEIR "special' tax, etc.
Dropped again to something like just above 20,000. And the family, and mom, didn't need the money.
Crap.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
No, you don't
