Is $67.00 too much for a term life insurance policy worrh $500k?

by hirby

That’s sounds about right for a 35 year level term insurance. Now that you are protecting your family, you should consider opening a retirement account such as a Roth IRA and invest on a monthly basis. If you invested in mutual funds of $200/month and you get an average rate of return of 12% during the next 35 years, you can potentially have $1.3 million.

Well, there you go, you’ll have the same premium of $67 for the next 34 years (regardless of any health problems or other life events). I am about 3 times as old and pay $123 for $200,000 that I got about 3 years ago and I think something happens when I turn 70. I’m in good health now, but did have a little problem that I told the insurance company about.

First of all, I would like to congratulate you for being worlds ahead and getting a policy at age 23 and looking at a really good amount!!! The good thing is I’m a firm believer of Life insurance. I always say get the most you can when your young and also….You’re less likely to be rated for health conditions when your young since your health is always better. If you happen to be a tobacco user this can have a bearing on the cost of the insurance being higher but you shouldn’t see such a drastic difference since age at this point is in your favor. It also sounds like you have a guaranteed policy so if this is correct your premium should remain level. I would also check to make sure that you have the option to convert this policy to a permanent insurance policy like a whole life or a universal life policy. The thing you may want to consider is, what will you want to do once you 34 year guarantee expires. Will you want to buy another term policy. I will definitely be more costly for you. So if you are going to considering a permanent policy. You may want to do this while you are younger, It’s more cost effective for you. Term Insurance is the most cost effective insurance at the beginning but as one get older the lost opportunity cost is much greater for you.

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