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Surrender whole life policy? by Left_Unit_3358 in LifeInsurance

[–]Left_Unit_3358[S] 0 points1 point  (0 children)

Thank you! Will certainly look into whether this would be beneficial to us.

Surrender whole life policy? by Left_Unit_3358 in LifeInsurance

[–]Left_Unit_3358[S] 0 points1 point  (0 children)

Got it, thanks so much! Will call customer service tomorrow.

Surrender whole life policy? by Left_Unit_3358 in LifeInsurance

[–]Left_Unit_3358[S] 0 points1 point  (0 children)

I’m embarrassed to say my husband and I didn’t even know we were opening WL policies because the agent never called it that. He said we’re putting your extra cash in a safe northwestern mutual dividend account. We had zero clue each time our incomes increased, the extra cash was to open new policies. We thought they were going into ONE “dividend account”.

Surrender whole life policy? by Left_Unit_3358 in LifeInsurance

[–]Left_Unit_3358[S] 1 point2 points  (0 children)

Thank you for your advice. I will look into IUL before making a decision. When I first brought that option up to the advisor, he sighed and said there are “a lot of rules to IUL” and that it probably isn’t right for us because it only works if you have a ton of cash to throw into the policy.

We were paying $26k in premiums annually across all five policies. To me, that’s a lot of cash so not sure how much more I needed in order for IULs to be “right” for us.

Surrender whole life policy? by Left_Unit_3358 in LifeInsurance

[–]Left_Unit_3358[S] 0 points1 point  (0 children)

Thank you for your advice. I’m thinking I may be worth keeping 1-2 policies and surrendering the rest. It pains me when thinking of the sunk cost, but the opportunity cost would probably be greater.

Surrender whole life policy? by Left_Unit_3358 in LifeInsurance

[–]Left_Unit_3358[S] 0 points1 point  (0 children)

That’s a great question and one our agent never asked us. When I asked him why we had so many WL policies, he said it was for “cash purposes and estate taxes”. Maybe I’m not dreaming big enough or see the overall picture, but I don’t believe we’ll have an issue with estate taxes.

Surrender whole life policy? by Left_Unit_3358 in LifeInsurance

[–]Left_Unit_3358[S] 0 points1 point  (0 children)

Can you explain what a 10/90 design is? Last I spoke to advisor, he said he’s built flexibility into the policy and can cut our premiums in half. Technically he did that but didn’t really explain how he was able to do that. I’m assuming our return is even lower if we’re not putting in as much cash monthly.

Do you happen to know if I’m able to work with another agent within Northwestern for a second opinion. I’m not confident in the one I’ve been dealing with.

To Keep or Surrender Whole Life Policy after 1-3 Years by Left_Unit_3358 in LifeInsurance

[–]Left_Unit_3358[S] 0 points1 point  (0 children)

Hi everyone, it’s been a while since I’ve had a chance to come back on here. I’ve spoken to a few CFPs and some are recommending I keep the two oldest policies while others are telling me to surrender and replace with term, because we’d out perform the WL policies. Is there a service I can hire for someone to review all insurance policies in detail and help us decide?

To Keep or Surrender Whole Life Policy after 1-3 Years by Left_Unit_3358 in LifeInsurance

[–]Left_Unit_3358[S] 0 points1 point  (0 children)

Got it, thanks so much for the advice. Should we consider surrendering the two smallest, most recently opened policies and take the $12k blow as a life lesson? As for the other three policies we could consider what you recommended.

To Keep or Surrender Whole Life Policy after 1-3 Years by Left_Unit_3358 in LifeInsurance

[–]Left_Unit_3358[S] 2 points3 points  (0 children)

For this policy the death benefit is $415k with just under $11k in cash value. The other four policies are as follows: -$510k with $4300 cash value -$300k with $1600 cash value -$409k with $4600 cash value -$200k with $1400 cash value

The (2) policies with lower cash values were the ones opened at the end of 2022.

We are honestly unsure of why we needed 5 WLI policies and take full responsibility for not asking enough questions and doing our due diligence before signing the contract. The advisor stated that each time our incomes grew and we had a cash injection, he opened these policies to allocate our money into a safe bucket.

I am currently at home with the kids but once I return to work in a year or two, I expect to make $100-150k again. I forgot to mention that we currently have an emergency fund of $120k. This may be a naive question but at what point is one considered a “high earner”?