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Still - working - Life insurance question
Old 10-31-2018, 03:39 PM   #1
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Still - working - Life insurance question

I have about 18 months left before I bail (could be anytime now but I am enjoying what I do, mostly, and there are some bonuses that I would like to cash in on).

It's open enrollment time and I have been buying life insurance through the company. But it is around around $2600/year for $340k of insurance. It has occurred to me that I don't really need life insurance anymore, since all debt has been retired for some time. So my thought is, why wouldn't I decline the life insurance and put that $2.6k into something that earns $$ for the next year and a half.

Any thoughts on this?
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Old 10-31-2018, 03:51 PM   #2
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If you have enough that your heirs would be ok without the life insurance proceeds then you don't need life insurance. I dropped my term policies long before I retired.

I do still pay a whopping $20/month on a 1977 whole life policy but the CSV is growing by what I put in plus about 4% a year so I view it as a substitute for a fixed income investment.
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Still - working - Life insurance question
Old 10-31-2018, 03:55 PM   #3
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Still - working - Life insurance question

Yes. Donít pay for life insurance if you donít need it. Also, it sounds very expensive. Most employers provide 1 or 2x salary at no charge. Around age 45 and beyond, my employerís group plan was more expensive than what I could get on my own from same insurer with medical exam.
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Old 10-31-2018, 04:04 PM   #4
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Originally Posted by jazz4cash View Post
Yes. Donít pay for life insurance if you donít need it. Also, it sounds very expensive. Most employers provide 1 or 2x salary at no charge. Around are 45 and beyond, my employer s group plan was more expensive than what I could get on my own from same insurer with medical exam.
I agree!

My former Megacorp used to provide 2xsalary free, and really cheap rates for up to 5x. Then our division was acquired by another Megacorp. They went 1x free and high rates for additional, similar to OP. Since we were FI by then, I stopped buying any additional.
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Old 10-31-2018, 05:57 PM   #5
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After reviewing your retirement assets and planned spending rate (initial post), I would certainly drop it. Since you're already FI, it seems highly likely, that your wife would financially better off if you predecease her (expenses would go down). But it depends on her SS income, survivor benefits, pension survivor benefits, total cash flow, etc.

I married late in life at 47, and never had life insurance. For the past four years, I figured my wife would be better off finacially without me...and she'd get an extra year's worth of my salary as a company parting gift!
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Old 11-01-2018, 07:55 AM   #6
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I've been life insurance free since I left MegaCorp 4 years ago. Mega provided some generous level of coverage - I don't recall the amount. DW and I had term policies outside of work while kiddies were little and NW wasn't sufficient to support them if we checked out early. Now we are comfortable that NW will meet all our family needs so we don't carry any life insurance. You need to assess your situation and make an informed decision. Some people will tell you that you are crazy to be without life insurance. I clearly don't agree with that - or I am crazy
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Old 11-01-2018, 07:59 AM   #7
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Totally agree. This doesn't apply in your case, but my previous employer provided (and paid for) life insurance that was some multiple of earnings and I had to pay taxes on the "imputed value" of the amount over $50K. I asked about dropping it and was told I had to wait till the next Open Enrollment. I was gone by then. :-)
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Old 11-01-2018, 07:59 AM   #8
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Yes. Donít pay for life insurance if you donít need it.
+1

Our 20 year term policy will be ending in a couple years. With no debt and son's college education paid for, we will go without insurance at that time.
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Old 11-01-2018, 10:47 PM   #9
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Thanks for the advice. Turned in my open enrollment form today sans any insurance.
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