March 2009 Weddings
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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Pam
Let me know if you want to bounce some questions off of me re: life insurance. I work for an agent and we actually just made some changes on ours to get ready for baby, so maybe it would help having another viewpoint?
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Re: Pam
::butting in::
We just started getting quotes for term life insurance for DH. His work gives him 2x his salary for free, so we're thinking about doing an additional policy that would put as around 10x his salary. We're trying to figure out if we should do 20 or 25 years. Is that good? Any suggestions or things to consider/think about?
LOL, is that overdoing it? That's what my Dad recommended to us. All of this "adult" stuff is hard to figure out, especially when there's no perfect answer.
our agent took our debt (mortgage plus school loans), 5 years' salary for each of us, education expenses for the kiddo and funeral expenses. for that total, our monthly cost was WAY more than we want/can pay right now. (until we get used to our mortgage payment, new bills, then daycare... that amount just is not happening right now). so we looked at some other options. and we both have some life ins. through work, too, so this would supplement that.
oh, the thing that kills us? ryan smokes. it would be a heck of a lot cheaper if he didn't. he is working on quitting (he decided he wants to before the baby - yay!). but you need to have not smoked in a year to get the lesser rate.
One thing we remind our clients that have group insurance from work -this is only good as long as you're employed with the company. So say for whatever reason, he is no longer employed there, that insurance is gone. At that point, he will be older, so rates will be higher and you don't know what your health will be. If someone were to become uninsurable within that time, you might not have a lot (if any) options to get insurance. So, long story short, we always recommend having some sort of personal policy, whether it's term insurance or a permanent policy.
I'd say 20 years is good for term insurance. That's what we just picked up on H. You want something that can come close to covering loss wages if, God forbid, something happened. Also keep in mind future college expenses for baby (if you were planning on helping baby with that).
Got it. Will you guys be able to readjust after he quits smoking for a year? Oh, and that's a question I have for either of you. How does it work when you readjust? Like, say in 3 years when we have another baby and we want more coverage... do they just adjust your current policy? Do the rates all get recalculated?
Pam, did your agent give you the education estimate? Our only debt is our mortgage, so we would need that, education, funeral, and Dh's salary for X years. I won't be working for a few years, so we just have a small policy on me.
See my post above about employer's life insurance - just something to keep in mind. In your case, term would be a good spot to start at - you can get a higher amount of coverage for a cheaper premium. Look into getting a term policy that is convertible. This means, years down the line when you want a permanent policy in place, you can convert a certain amount with no additional underwriting. This is where the health concerns can come into place, so it's beneficial to have.
An example we have here - one of our clients has been diagnosed with prostate cancer. More than likely uninsurable now, but he has a term policy inforce that can be converted. He'll want to do that before his "term" is up, when the yearly premium increases significantly each year.
Also, regarding Ryan's smoking. H smoked when we first placed his permanent policy on him 4 years ago. He quit smoking 3 years ago, so once the timeline came that he could be re-evaluated, we had the medical requirements done on him and he passed, so his rates were lowered!
Every company is different, so you'll definitely want to check with your agent on that question. But yes, you'll want to either increase your coverage or pick up another policy to cover that increase that is needed.
We're going to get the extra policy on our own, which will be the big one. Everything you mentioned is very valid, so do you think we should just not take the 2x work policy into account when we do our calculations?
Honestly, that would be a question for your agent. If it's free, definitely sign up for it. It sounds like the larger policy would be sufficient coverage should this ever be the case?
His small work policy is free, so we get it regardless. Thanks for your input
thanks, ladies. this is all helpful. we'll definitely do term with the option to convert to whole life. and yes, rates will go down once he's smoke-free for a year.
kristen, i think the estimate was 200K - 250K for college for one child.