Having reviewed the above thread, I've decided to choose "Life Insurance" for a 20 years term insurance considering the following
1. Property should appreciate in its value considerably in 20 years.
2. Early pay off close 20 years. (5 yrs before the amortization)
3. Less cost of insurance for the remaining principal if any after 20 years.
I'm really not finding other options very attractive in my own financial perspective.
Any important point with the above that I am not able to foresee ?
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The cowards never started,
The weak died on the way,
Only the strong arrived.
http://www.youtube.com/watch?v=_yK1i9cLAMM
Location: carl sagan's universe
Posted on: 31-01-07 00:30:54
Hi JRF,
In my opinion, you have taken the right road. A term insurance for 20 years is recommended at the outset and then after a couple of years or more if you feel the need, convert to a permanent insurance or a hybrid term/permanent as per a contributor before.Some insurance companies out there will also allow you to use a certain percentage of the premiums you have paid on your term policy towards your permanent policy when you convert.
Go for the 20 year term!Make sure it is renewable and convertable (R & C).
Your pt .3. Please give this more thought. Even though your house mortgage may be less after 20 years, your other insurance needs may be more. You may want to leave a legacy for your children, your spouse, grandchildren.....
But yeah, as the famous old chess saw goes "when in doubt push a pawn" i.e go for the simplest move first then once undertaken , review the situation and formalize your attack plan.
Enjoy!
Hello investpro,
Although I've confirmed the renewable part of the term insurance, I forgot to check whether it is convertible. Thanks for pointing out, I will check that besides I haven't signed it yet.
Articulating my Point #3.
Assume that I am starting with a $250K mortgage for 25-30 years mortgage.
1. I will be in dire need of some insurance to cover the mortgage / life initially.
2. In the course of 15-20 years, the house price would've appreciated much, in case of unforeseen hardship, the appreciated value should cover the remaining principal at ease.
3. Chances are high, that I would've made some anniversary payment to the principal directly, that once again may not leave any principal to be paid on the property after 20 years or really a very small amount.
4. As I am setting my foot strong gradually, I am looking to explore other avenues of investment than brooding on a unified investment be it is a house or life insurance.
As you referred, Convertible option seem to be the way but I may need to go through a medical once again with a 15-20% additional premium if I do this after 5 years.
Generally in North America, your financial position, needs, perspective etc., etc., changes in 5 years considerably, that being the reason I incline to choose this kind of option.
Warm regards,
Quote:
Originally posted by investpro
Hi JRF,
In my opinion, you have taken the right road. A term insurance for 20 years is recommended at the outset and then after a couple of years or more if you feel the need, convert to a permanent insurance or a hybrid term/permanent as per a contributor before.Some insurance companies out there will also allow you to use a certain percentage of the premiums you have paid on your term policy towards your permanent policy when you convert.
Go for the 20 year term!Make sure it is renewable and convertable (R & C).
Your pt .3. Please give this more thought. Even though your house mortgage may be less after 20 years, your other insurance needs may be more. You may want to leave a legacy for your children, your spouse, grandchildren.....
But yeah, as the famous old chess saw goes "when in doubt push a pawn" i.e go for the simplest move first then once undertaken , review the situation and formalize your attack plan.
Enjoy!
-----------------------------------------------------------------
The cowards never started,
The weak died on the way,
Only the strong arrived.
http://www.youtube.com/watch?v=_yK1i9cLAMM
