Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Please convince me to drop Term Life Ins. and Prof. Org. Dues
Old 08-07-2010, 11:36 AM   #1
Thinks s/he gets paid by the post
Telly's Avatar
 
Join Date: Feb 2003
Posts: 1,448
Please convince me to drop Term Life Ins. and Prof. Org. Dues

Many years ago, when I was at the Big U, I joined a big international technical association for my field. Was told it would look good on the resume back then .

Later, I picked up very cheap term life insurance through them, as I did not have any life ins. other than through employer, and wanted something transportable. Had young kids then, the rate was cheap, got $120K on me, half value on DW.

The years have gone by... been years since the start of my ER, kids are through college and out on their own. And as I have gotten older (eeek!) the rate is climbing. Now about $500 a year for the coverage listed above.

I (sometimes) read the monthly magazine that the prof. org. puts out. I have been able to use the "unemployed" rate of $85 a year, they won't allow "retired" rate (same $) till age 65.

I feel funny cancelling the prof. org., though it is obvious I will not go back to my field. Don't want to, ER too much fun, and the time away and age makes me probably unemployable by the "younger" people running most of it these days. But when I think of cancelling it, it's sort of like I'm closing a big door, making myself obsolete, unwanted sniff sniff.

Now the bill came in the mail for the next half-year of term insurance. The rate had gone up 70% at age 50, then went up another 60% at 55, to the $500/yr of today. Expect another big jump at 60. And the prof. org. renewal will come up late in the year. I can't have the insurance without membership in the org. Seems if I'm going to bow out, now is the time to drop the term ins., then drop the org itself year end.

I know I should drop them, but it seems like I'm losing something I won't be able to get back.

I need convincing, a big push, a whack on the head, something. Help!
__________________

__________________
-- Telly, the D-I-Y guy --
Two fools dancing on the hands of time
Telly is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 08-07-2010, 11:43 AM   #2
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas Hill Country
Posts: 42,117
If your heirs don't need the money, why pay $500/yr to give them a "parting gift"?

As to dropping the professional org dues, more waste of funds. Get over it!

You're welcome.
__________________

__________________
Numbers is hard

When I hit 70, it hit back

Retired in 2005 at age 58, no pension
REWahoo is offline   Reply With Quote
Old 08-07-2010, 11:44 AM   #3
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Why exactly do you need life insurance now? Is there an estate planning reason for carrying the insurance? Do you have any dependents who would be in trouble income wise if you dropped dead? If not, I think you have a solid case to keep your $500.
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Old 08-07-2010, 11:49 AM   #4
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
There are three main reasons for life insurance (at least which make financial sense): income replacement, business continuance and estate planning/taxes. If none of these three apply to you as a need, yes -- dump it. Save the $585 on annual dues and premiums. Consider the premiums already paid as a blessing that you (or your heirs) didn't have to collect on it.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
ziggy29 is offline   Reply With Quote
Old 08-07-2010, 11:57 AM   #5
Moderator Emeritus
 
Join Date: May 2007
Posts: 11,044
It makes no sense to me to keep the professional membership and the life insurance policy ($120K benefit? Must be peanuts compared to your net worth!). Close that "big door" already and get on with it.
__________________
FIREd is offline   Reply With Quote
Old 08-07-2010, 12:05 PM   #6
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
bbbamI's Avatar
 
Join Date: Dec 2006
Location: Dallas 'burb
Posts: 9,039
Ask the kids if they want to pay the premiums and fees...if not, and you don't have a need for the insurance, dump it and wave bye bye....
__________________
There's no need to complicate, our time is short..
bbbamI is offline   Reply With Quote
Old 08-07-2010, 12:18 PM   #7
Recycles dryer sheets
 
Join Date: Sep 2007
Posts: 184
I was in the same situation as you Telly. IEEE term insurance was cut to 70% but the premium remained constant. I called them and they said they would not insure me after 70. So I canceled the term insurance. Additionally, since I was unemployed and their disability insurance came due, they would accept the payment but not payoff since I was unemployed. So I canceled that also. As for the membership, I'll keep that on a year to year basis.
__________________
HpRyder is offline   Reply With Quote
Old 08-07-2010, 12:27 PM   #8
gone traveling
 
Join Date: Apr 2009
Location: Eastern PA
Posts: 3,851
"Please convince me to drop Term Life Ins. and Prof. Org. Dues"

OK; stop doing it or I'll send "Big Louie" over to your house to break some bones ...

It would be just easier to just say no; you don't need this "crutch" at this stage of your life.
__________________
rescueme is offline   Reply With Quote
Old 08-07-2010, 01:39 PM   #9
Thinks s/he gets paid by the post
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 3,399
My DH retired at 62 recently. We had an option to continue his life insurance. We ended up continuing only $300k of it because the rate was so high. In our case he is taking SS and I am not eligible for several years. We felt that we needed enough to bridge the gap between now and when I would be eligible for my own SS so plan to keep the insurance for the next several years (in our case, we can decrease coverage and plan to decrease it each year).

FWIW $500 a year for the coverage you have would be very cheap compared to what we are paying.
__________________
Katsmeow is offline   Reply With Quote
Old 08-07-2010, 01:52 PM   #10
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas Hill Country
Posts: 42,117
Quote:
Originally Posted by Katsmeow View Post
My DH retired at 62 recently. We had an option to continue his life insurance. We ended up continuing only $300k of it because the rate was so high. In our case he is taking SS and I am not eligible for several years. We felt that we needed enough to bridge the gap between now and when I would be eligible for my own SS so plan to keep the insurance for the next several years (in our case, we can decrease coverage and plan to decrease it each year).

FWIW $500 a year for the coverage you have would be very cheap compared to what we are paying.
Did you factor SS Survivor Benefits in your calculation? It could be there isn't a lot of gap to bridge and it sounds as if you are paying a lot for the insurance coverage.
__________________
Numbers is hard

When I hit 70, it hit back

Retired in 2005 at age 58, no pension
REWahoo is offline   Reply With Quote
Old 08-07-2010, 01:53 PM   #11
Thinks s/he gets paid by the post
Bikerdude's Avatar
 
Join Date: Jul 2006
Posts: 1,901
$585 a year is like adding $14,625 to your stash at a 4% SWR.
__________________
“I guess I should warn you, if I turn out to be particularly clear, you've probably misunderstood what I've said” Alan Greenspan
Bikerdude is offline   Reply With Quote
Old 08-07-2010, 01:56 PM   #12
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
Quote:
Originally Posted by Bikerdude View Post
$585 a year is like adding $14,625 to your stash at a 4% SWR.
Nicely played.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
ziggy29 is offline   Reply With Quote
Old 08-07-2010, 01:57 PM   #13
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: May 2004
Posts: 11,615
Some points:
- You bought term insurance rather than whole life way back then because you wanted to "pay as you go," buying the insurance as you needed it. If you don't need the insurance anymore, it sounds like it would be a good idea to drop it.

- That will give you $500 more per year to spend however you want. If you really can't bear to close the door on the professional organization, you could use the first year's insurance savings to pay for about 6 years of dues in the org, which takes some of the pain out of the expense. But, before you do, ask yourself if this is really going to bring you more pleasure than any other use of that money. Do you go to the meetings now, or to the annual conventions? Do you keep in touch with other members of the group? Does the organization provide any tangible/material benefit to you?
__________________
"Freedom begins when you tell Mrs. Grundy to go fly a kite." - R. Heinlein
samclem is offline   Reply With Quote
Old 08-07-2010, 04:13 PM   #14
Thinks s/he gets paid by the post
Htown Harry's Avatar
 
Join Date: May 2007
Posts: 1,516
In your obituary, "Telly was a widget-maker and a member of the American Society of Widget Makers" doesn't need specific dates.
__________________
Htown Harry is offline   Reply With Quote
Old 08-07-2010, 08:19 PM   #15
Thinks s/he gets paid by the post
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 3,399
Quote:
Originally Posted by REWahoo View Post
Did you factor SS Survivor Benefits in your calculation? It could be there isn't a lot of gap to bridge and it sounds as if you are paying a lot for the insurance coverage.

I did consider it, but it doesn't totally bridge the gap.

As for me I am still working part time.

We have children under 18 already and they receive 50% of DH's benefits (up to the family maximum).

If DH died, and I wasn't working, I could get benefits while caring for a child under 16 (we have one). However, she will be 16 in a couple of years. At that point I would only be eligible at 60 if I wanted to take reduced benefits (I would prefer to wait until age 62).

Even then, my getting benefits doesn't add that much to the mix since there is the family max. (That is the kids benefits alone would max out the family max).

The only way we end up whole for the next few years is to have some modest life insurance. After that, no need for it.
__________________
Katsmeow is offline   Reply With Quote
Old 08-08-2010, 05:23 AM   #16
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Feb 2007
Posts: 5,072
IMO - it depends on the terms of the coverage. HOw long can you keep the policy? Is there any premium protection? Do you at least lock-in a rate for 5 years? You probably will get a big premium hike at 60. Try to get an understanding of how premium increases are handled and do some number crunching. If you have any health problems, you could not get life insurance. $500 is not much.

Aside from the cost of premium, you should consider the impact of your death on your spouse. She will loose some SS payments... if other pension sources are reduced, she will have less money to live on. The same goes for you.
__________________
chinaco is offline   Reply With Quote
Old 08-08-2010, 12:52 PM   #17
Full time employment: Posting here.
 
Join Date: Jan 2007
Posts: 582
I agree that keeping the insurance seems to make no sense.

But I don't see any reason to drop the professional membership if you're not ready yet. You're saying membership is $85 per year? It sounds like in another year or two you'll be ready to move on, so I'd count that as a small "nostalgia" cost.
__________________

WM is offline   Reply With Quote
Old 08-08-2010, 02:05 PM   #18
Thinks s/he gets paid by the post
Koolau's Avatar
 
Join Date: Jul 2008
Location: Leeward Oahu
Posts: 3,244
I went through this head game myself, only BEFORE I retired. My professional organization and certification (two different things) were costing me quite a bit of money. My j*b had morphed away from this particular specialty and my Mega Corp never really honored either membership anyway. Some companies pay for one or both for this particular specialty because it lends incredible credence if one were to ever be called as a corporate witness.

It did hurt me, but I dropped both memberships (as well as membership in a local chapter). No repercussions except that I had a lot more money (well, a couple of hundred more) to do fun stuff with. Honestly, it was partly a thumb in the eye of Megacorp. I felt that they "used" my credentials when it suited them and ignored them (and the effort it took to get them - Masters degree and imagine 2 days in a little room taking a 1000 question series of tests) when it came time for rewards. So.... I showed them! It still hurt, but I got over it. It was like closing a door with a slam instead of a "click".

In the unlikely event that I ever wanted to "practice" again, I would negotiate the issue with a future empl*yer. e.g., "You want me to get certified, you pay all expenses AND provide the time for study AND send me to certification "school". It never came up as I'm happily ERd.

The insurance: Others have given you good council on that. You might even check around. If you are in good health, you could be surprised to find that you could get a better rate on the outside. My "group" insurance at Megacorp was "free" (included, actually) up to a certain level. Further units were available at a group rate. Because of the natural selection of the "uninsureable", the rates were significantly higher than many could have obtained if their health was good.
__________________
Ko'olau's Law -

Anything which can be used can be misused. Anything which can be misused will be.
Koolau is offline   Reply With Quote
Old 08-08-2010, 04:09 PM   #19
Thinks s/he gets paid by the post
 
Join Date: Jun 2005
Posts: 1,152
I think the bigger question is to look inside yourself to determine why you would even be tempted to continue something like this which makes no financial sense. You may learn something about yourself.

Kramer
__________________
kramer is online now   Reply With Quote
Old 08-08-2010, 04:43 PM   #20
Thinks s/he gets paid by the post
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 3,399
Quote:
Originally Posted by kramer View Post
I think the bigger question is to look inside yourself to determine why you would even be tempted to continue something like this which makes no financial sense. You may learn something about yourself.

Kramer
He hasn't yet said that the life insurance makes no financial sense. He has said that he ER'd awhile ago and kids are grown. He hasn't said if his wife would need the money from the life insurance if he died. If she doesn't then I agree it makes no sense to keep the membership and the insurance. On the other hand if she needs the life insurance then it might indeed make sense. (I'm guessing she doesn't but the post didn't actually clarify that point).
__________________

__________________
Katsmeow is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Exprience with member/prof org group plans ymidt Health and Early Retirement 7 12-06-2007 05:16 PM
Drop Adjustable Life Insurance Policy? kjpliny FIRE and Money 5 03-10-2007 11:26 PM
What to do with Met Life Ins. Policy Adventuregirl FIRE and Money 6 02-04-2006 06:50 AM
Whole Life Ins. 73ss454 Other topics 8 06-12-2005 07:24 PM
Term vs. whole life? retire_asap Other topics 9 10-28-2004 08:05 PM

 

 
All times are GMT -6. The time now is 09:44 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.