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Re: Role of life insurance
Old 12-03-2005, 02:44 PM   #41
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Re: Role of life insurance

I dropped my life insurance a couple of years ago. Investments made much more sense and should cover all contingencies. If the wife can live with the 4% rule (and SS or pension) why do you need insurance?
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Re: Role of life insurance
Old 12-04-2005, 09:41 AM   #42
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Re: Role of life insurance

Quote:
Originally Posted by JPatrick
Ok, some fine intentions expressed in you post, but you are throwing around figures that I would suppose would reach or exceed 2 million $$.
That amount of cheap term poses no serious challenge when you are forty something, but what are you facing in premiums when you reach 70 and perhaps way beyond?
I generally am not a fan of this kind of strategy, but if one wishes to do this sort of thing, you don't use term. Instead you use a newer product which many life insurers appear to have irrationally underpriced in some cases: guaranteed no-lapse universal life. It is basically the equivalent of fixed term for life. Even so, a $2 million No-lapse policy on a 55 year old is a significant chunk of change.
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Re: Role of life insurance
Old 12-05-2005, 11:03 AM   #43
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Re: Role of life insurance

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Originally Posted by davew894
I have life insurance and I support the idea, even in ER.* To me, the money is just a small way of apologizing for dying and trying to make the rest of the family more comfortable now that I'm gone.

What I do worry about is some money grubbing low life putting on a song and dance to marry my beautiful, loving and trusting wife and then leaving her a year or two later, after he's emptied the coffers.

I have thought about setting up a trust or something that would simply provide income, rather than a pile of money that someone could take.

Anyone else think about doing that?
Have done it.
My trust is by far the larger of the two between my DW and I. My kids are not hers and vice versa so our trusts protect our respective assets as much as possible from a future GoldDigger. While our trusts will provided for the surviving spouse first, they still have some restrictions on remarriage and use of the funds.

Sometimes you just need to plan for the worst but hope for the best. My kids will be provided for no matter who shows up after I am gone. It is not a matter of trust, it is a matter of reducing the variables in getting my net worth to my kids in the amount I wish for them to have.
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Re: Role of life insurance
Old 12-05-2005, 11:21 AM   #44
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Re: Role of life insurance

All of you guys with your unsophisticated wives--don't worry, we will figure out what we need to figure out when you are gone.

My aunt--never drove, never handled a checkbook. My uncle died, she is taking care of business just fine.



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Re: Role of life insurance
Old 12-05-2005, 11:27 AM   #45
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Re: Role of life insurance

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Originally Posted by davew894
I have thought about setting up a trust or something that would simply provide income, rather than a pile of money that someone could take.

Anyone else think about doing that?
Another angle is that one spouse may be the money manager and the surviving spouse may not be as savvy in how to manage the portfolio and take distributions from it. A while back someone posted a lettter written for his wife with instructions on managing the investments in case of his passing.

Aside from gold digging next spouses there are FPs and well-meaning relatives that could damage the portfolio with poor investment vehicles and/or high fees.

But Martha says the women will figure it out, so nevermind.
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Re: Role of life insurance
Old 12-05-2005, 11:41 AM   #46
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Re: Role of life insurance

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Originally Posted by BigMoneyJim
Another angle is that one spouse may be the money manager and the surviving spouse may not be as savvy in how to manage the portfolio and take distributions from it. A while back someone posted a lettter written for his wife with instructions on managing the investments in case of his passing.

Aside from gold digging next spouses there are FPs and well-meaning relatives that could damage the portfolio with poor investment vehicles and/or high fees.

But Martha says the women will figure it out, so nevermind.
Or maybe I overreacted to the trust idea--controlling a spouse's life after you are gone is troublesome to me. Greg has his "Martha when I am dead, buy these funds" list. And I have my "Greg, please take care of my family" request. Maybe just a simple discussion with your spouse where you can air worries as to your spouse's lack of sophistication regarding investments and money managment skills.

EDIT: I am not talking about complicated family situations where there are children from prior marriages, etc., like Steve's situation.
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Re: Role of life insurance
Old 12-05-2005, 11:46 AM   #47
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Re: Role of life insurance

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Originally Posted by Martha
Or maybe I overreacted to the trust idea--controlling a spouse's life after you are gone is troublesome to me.* *Greg has his "Martha when I am dead, buy these funds" list. And I have my "Greg, please take care of my family" request.* Maybe just a simple discussion with your spouse where you can air* worries as to your spouse's lack of sophistication regarding investments and money managment skills.* *
I agree with Martha. Trying to control people from the grave (or pimp them, in Azanon's case) is of questionable judgement, IMO. Ultimately, we are all responsible for ourselves. I periodically walk DW through out investments (pausing when her eyes glaze over) and included in the packet with our wills is a step-by-step list of instructions of what to do WRT money after I croak. If she can't follow the instructions or come up with a better idea, she will have to live with the consequences.

My minor children are another story. Until the kids are grown the assets would be held in trust and doled out as appropriate. Once they are grown, though, they will have to abide by the consequences of their actions, especially after I am not around to help pick up the pieces.
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Re: Role of life insurance
Old 12-05-2005, 01:07 PM   #48
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Re: Role of life insurance

But being a woman I also understand how other women think and knowing my dh he could be taken advantage of quite easily. So I think the argument works both ways, you have to do what's best for whom ever is left behind. If they are unable or unwillng to deal with handling the nestegg then I see no reason not to leave something in place to assure they are taken care of. I know if something happened to me the wolves would be knocking at the door.
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Re: Role of life insurance
Old 12-05-2005, 01:31 PM   #49
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Re: Role of life insurance

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Originally Posted by Outtahere
and knowing my dh he could be taken advantage of quite easily.
Yes, but it happens to us guys all the time and we actually enjoy it.* There's no conscious thought process ocurring then anyway.

Quote:
Originally Posted by Outtahere
I know if something happened to me the wolves would be knocking at the door.
And that's why no one posts any addresses or phone numbers here!
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Re: Role of life insurance
Old 12-05-2005, 02:07 PM   #50
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Re: Role of life insurance

I initially would have stated I don't see any need for Life Insurance upon the beginning of FIRE, but I realize after reading this thread that indeed, we have allocated significant resources to the Life Insurnace concept, albeit with a twist. Since we are both pensioners, DW already there, and me soon to join, we let our "real" LI expire when we left employment as it was maintained by Payroll deductions and very reasonable in cost for a few hundred thousand coverage. And it made sense during my working years, as I wanted insure sufficent funds to make up for DW's loss of my workaday income.

However upon termination of employment one of those questions for the Retirement Division is what kind of surviorship provisions does one wish to choose...

So in effect we both decided in advance to "pay" for 100 percent lifetime survivorship payments to be paid to the surviving spouse for ever and ever, IOW until the second one croaks.

This will reduce my pension about 100 dollars or so per month, so I realize now that I am indeed agreeing to pay life insurance premiums for life, as is DW to provide for me. The beauty is the rates never change, and the payout is completely uncomplicated, basically the money just keeps showing up in our Joint Bank Account as long as one of us lives. Other options included providing a percentage of the Pension in exchange of less of a deduction, and of course we could have opted to leave each other nada, for no reduction. I'm happy with the trade off, as it's pretty reasonable in cost, we'll never feel it as bill to pay, and no decisions will ever have to made re: investments etc.

I like it.
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Re: Role of life insurance
Old 12-05-2005, 03:44 PM   #51
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Re: Role of life insurance

Unfortunately Nords the wolves I'm referring to already know where he/we live, but on the other hand he knows which of his "friends" would be knocking at the door the day he croaks too.
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Re: Role of life insurance
Old 12-05-2005, 03:56 PM   #52
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Re: Role of life insurance

Ah, I can see that most of you are young...

Establishing a trust and putting some belts/suspenders around it is wise when there are minor children or elderly adults. I have watched elderly adults forgit what they knew about money management. They can be as vulnerable as children to vultures. It is not a guy or gal issue.
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Re: Role of life insurance
Old 12-05-2005, 08:51 PM   #53
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Re: Role of life insurance

Quote:
Originally Posted by Outtahere
But being a woman I also understand how other women think and knowing my dh he could be taken advantage of quite easily.* So I think the argument works both ways, you have to do what's best for whom ever is left behind.* If they are unable or unwillng to deal with handling the nestegg then I see no reason not to leave something in place to assure they are taken care of.* *I know if something happened to me the wolves would be knocking at the door.
So true. There was an old man in the neighborhood where I grew up. He was quite wealthy, and nobody's fool.
But when he was 86 he married an 18 year old girl. She was really pretty, but even horny 24 year old me knew enough to stay well out of her way. A few years later she was still pretty, but several million dollars richer. And still a low class whore.

When I went to church it was always fun to watch the single women in the congregation attack a new widower, especially one thought to be "eligible". Grief and loneliness, and sometimes a degree of longing to satisfy unmet yearnings from the prior relationship can make people do funny things.

Read your Jane Austen!

Ha
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Re: Role of life insurance
Old 12-05-2005, 10:47 PM   #54
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Re: Role of life insurance

You know, if I'm a middle aged widower and some young hottie is throwing herself at me because I'm financially established, I'm not sure that's a bad deal. Still, I truly hope I'm never in that position, being that I met my wife when we were both very young and very poor has preserved a lot of innocence in our lives that I cherish. Filthy Lucre!
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Re: Role of life insurance
Old 12-05-2005, 11:22 PM   #55
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Re: Role of life insurance

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Originally Posted by Laurence
You know, if I'm a middle aged widower and some young hottie is throwing herself at me because I'm financially established...* Filthy Lucre!*
Been there, done that, got the T shirt to prove it. It happens all the time to both widows and widowers. I have several close friends that have been widowed and many of the middle aged ones with a decent amount of financial resources have been targeted by the not so well off. Golddigging is alive and well.

Having some one throwing themselves at you when you are still mourning sucks.
You learn to be careful about people. I got lucky and found a really good woman and my experiences with "other types" was thankfully limited but educational.
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Re: Role of life insurance
Old 12-06-2005, 12:46 AM   #56
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Re: Role of life insurance

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It happens all the time to both widows and widowers.
Not only gold diggers, but some loose their ability to make sound financial decisions.* When my husband's family moved their mother to a care setting they found money stashed around her apartment.* Same thing when I had to help with my father.* They got to the point when writing a check was too complicated, would take cash out from the bank nearby for pocket money.* Those pockets got pretty full.
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Re: Role of life insurance
Old 12-06-2005, 06:54 AM   #57
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Re: Role of life insurance

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Originally Posted by Brat
Not only gold diggers, but some loose their ability to make sound financial decisions.* When my husband's family moved their mother to a care setting they found money stashed around her apartment.* Same thing when I had to help with my father.* They got to the point when writing a check was too complicated, would take cash out from the bank nearby for pocket money.* Those pockets got pretty full.
This is a common thing (stashing cash). My elderly father has cash
hidden everywhere. However, he can't remember where he put any of it. Some day, we'll have an "Easter Egg Hunt".
Should be interesting................

JG
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Re: Role of life insurance
Old 12-06-2005, 06:57 AM   #58
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Re: Role of life insurance

Brat my friends mother is doing that, he has to sneak in the house to check her hiding spots, redeposit it so she can take it out again. We had another friend that did the easter egg hunt after her dad passed.

Also don't think there had to be a death to bring out the gold diggers, a divorce or even a separation will do it. My dh's son is separated from his wife, good looking, nice guy, nice house, great job... some little tart saw all this and thought she was going to latch on to him...thankfully he was smarter than her and showed her the door the other night. He learned a valuable lesson, one I'd been hinting at but he was not listening carefully enough to hear.
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Re: Role of life insurance
Old 12-06-2005, 06:59 AM   #59
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Re: Role of life insurance

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Originally Posted by SteveR
Been there, done that, got the T shirt to prove it.* It happens all the time to both widows and widowers.* I have several close friends that have been widowed and many of the middle aged ones with a decent amount of financial resources have been targeted by the not so well off.* Golddigging is alive and well.*

Having some one throwing themselves at you when you are still mourning sucks.* **
You learn to be careful about people.* I got lucky and found a really good woman and my experiences with "other types" was thankfully limited but educational.
DW and I married strictly for love. *Her net worth was close to zero
and mine was not much either. *We met through an internet
"Matchmaker" site. *She often says she wishes she had never bought
that "damn computer". *I wonder what she means by that? *

JG
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Re: Role of life insurance
Old 12-06-2005, 07:05 AM   #60
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Re: Role of life insurance

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Originally Posted by Outtahere
Brat my friends mother is doing that,* he has to sneak in the house to check her hiding spots, redeposit it so she can take it out again.* We had another friend that did the easter egg hunt after her dad passed.

Also don't think there had to be a death to bring out the gold diggers, a divorce or even a separation will do it.* My dh's son is separated from his wife, good looking, nice guy, nice house, great job... some little tart saw all this and thought she was going to latch on to him...thankfully he was smarter than her and showed her the door the other night.* He learned a valuable lesson, one I'd been hinting at but he was not listening carefully enough to hear.
I can't tell you the number of people I've known who divorce
or separate and jump right into dating. This has potential for disaster
written all over it. Courtship is fraught with problems anyway.
Go into it with your head already swimming in a stew of conflicts
and questions?? Man, it's just asking for trouble IMHO.

Hey, that was a hell of a good metaphor. Do NOT try this at home.

JG
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