12 August 2014 0 Comments

When You Want Term, But Conversion is the Only Answer

I previously discussed how converting term insurance works.  It’s when you decide you no longer want term insurance and you exchange your term policy for a permanent policy without having to provide any current personal information to the insurance company.  The new permanent policy is issued in the same underwriting class as the term based [...]

20 May 2014 0 Comments

The Language of Life Insurance

I’m guilty!  There are times when I banter around terms that mean something to me, but are meaningless—or downright misleading—to non-insurance people.  That’s why I included a Life Insurance Terminology tab on this site.  But, even with that assist, much of our “insider’s terminology” needs clarification.  So, here goes on some of those terms that [...]

16 May 2014 0 Comments

What do you do with the cash?

In my last entry I discussed steps to take when replacing one life insurance policy with another.  Now I’ll cover what considerations there are when a life insurance policy that has cash value is either being replaced or discontinued. Options available to use the cash to continue insurance with the same policy were covered two [...]

14 May 2014 0 Comments

Help! My Life Insurance Premiums are too High!

If premiums for your car insurance are too high, you simply shop the market and if another insurance company beats what you’re paying, you switch.  It’s a pretty easy decision to make.  But, the Life Insurance switch is not so easy.  Aside from the fact that life insurance policies tend to be more complex, it’s [...]

8 May 2014 0 Comments

The Case of the Unecessary ILIT

A few years ago you may have established an Irrevocable Life Insurance Trust (ILIT) in order to provide liquidity for estate taxes.  At the time, the per-person exemption was only $1,000,000 but now the exemption is north of $5,000,000 and due to rise with the CPI.  The life insurance in that ILIT is no longer [...]

2 May 2014 0 Comments

Potential Pitfalls of Deferred Annuities – Part Two

In Part One of this discussion on the potential pitfalls of Deferred Annuities I mentioned Surrender Charges.  Surrender charges are imposed to compensate insurance companies for the commissions and other acquisition costs they incur when a Deferred Annuity is purchased.  If the annuity stays in force long enough, these costs can be amortized over the [...]

30 April 2014 0 Comments

Potential Pitfalls of Deferred Annuities – Part One

In my previous entry “The Truth About Annuities” I provided an overview of the two types of annuities, Immediate and Deferred, touching on the strengths and weaknesses of Immediate Annuities as well as the major strength of Deferred Annuities—tax deferral.  Now it’s time to cover the downside of Deferred Annuities.  But, first it’s important to [...]

25 April 2014 0 Comments

The Truth About Annuities

The mere mention of annuities among investment advisors can conjure up a myriad of opinions from: they’re a lousy investment—to—what a great tax advantage.  Interestingly, both of these statements might be true.  Of late, the debate has grown louder due to a plethora of Indexed Annuities that seem to promise the best of both worlds—growth [...]

23 April 2014 0 Comments

The Catch to my “Live it up or Leave it” Solution

In my last entry I showed how a couple could guarantee delivery of $250,000 when the second of them died by purchasing a Second-to-Die policy for a single premium of only $76,565, allowing them to live it up during their retirement while fulfilling their dreams of a legacy for their grandkids.  When some people look [...]

18 April 2014 0 Comments

Live or Leave? That is the Question

Did I get your attention?  Ok, so here’s what I mean by this provocative question.  More than one acquaintance of my wife and me who fall into our general age category—the 70’s—have voiced a concern with the dilemma posed by this question.  That is, they want to live their retirement years to the fullest, enjoying [...]