Dave Ramsey says: Closing whole life policy

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  • toosmartforyou Farmington, UT
    Feb. 14, 2013 8:17 a.m.

    I hope AggieLove reads this articlce after reading his comments on Feb 8th. Pay close attention to this wording:

    "Term life insurance is much less expensive than whole life. Plus, did you know that you lose the part of your whole life policy known as the "savings plan" or "cash value" when you die? They only pay the face amount of the policy. So, close it out and stop pumping money into that thing!"

  • Cinci Man FT MITCHELL, KY
    Feb. 14, 2013 7:20 a.m.

    I also bought a $100,000 whole life policy from Beneficial Life 36 years ago with a promise (not guarantee) that after 7-11 years, the dividends would pay the premiums and I would not have to pump any more money into it. Now, 36 years later, I'm still paying year after year about half the premiums because I believed them. Every year the company allocates less and less earnings to this plan and I get stuck. I have never given them any more business and never will.

  • Obama10 SYRACUSE, UT
    Feb. 13, 2013 9:00 a.m.

    I love Dave, but I have one other suggestion as to the whole life policy. As a former life insurance salesman, I agree that term is the way to go. But, if you have a whole life policy that you have been paying on for sometime, it may have enough "cash value" in it, to keep the policy going without you paying anymore money. I bought a small $100,000 whole life when I was first married and paid on it for about 10 years. I stopped making the payments a couple of years ago, but I still have the coverage because the "cash value" earns enough to pay the premium. So I still have the coverage that I paid for, but am no longer making the payments. In this instance there is no reason to "close out" the policy; I just stop makin the payments and still get the coverage. Talk to your agent about this option before closing a whole life insurance policy.