what type of policy is right for me?

I am 28 years old single and a homeowner. I want to get an insurance policy for myself. I met with an agent today and she was pushing a 500K variable life policy on me. It sounded fishy from the get go. I always hear people say term is better and the price you pay for other plans that build cash vaule are a waste. You can invest that money elsewhere and get a better return.

Anyway she was trying to sell it to me as a retirement plan and emergency fund. Telling me if I need money I can borow against it. Plus there is no tax on it when I withdraw the money from it when I am older. It would cost me 240 per month for this policy and told me it guarantees a minimum return of 1% and maximum of 12%.

I do have insurance through work but when i stop working or find another job, I will not have it so I know I have to purchase some type of policy on my own.

I am also a big fan of dave ramsey and he does not recommend any type of cash vaule policys, only term life. Can someone give me a ball park number on what I may pay for a term policy in good health and non smoker?

Also after the term is over, can I renew for another term without evidence of insurability or will I have to go through all that again?

any advice would be appreciated

My advice to you is to research before you make the decision. If you want to keep your investments simple you can stick to mutual funds that have solid three- to five-year track records and low expenses. You can even opt to have the fund company make automatic monthly withdrawals from your bank account to force you to save.

Most planners recommend that you base your asset allocation on your child's age. If your child is eight or younger, you can keep 60 to 95 percent of your money in stocks. You can choose a balanced fund, which holds a prescribed ratio, usually 60-40, of stocks to bonds. Or you can choose your own mix of funds and invest proportionately.

Happy investing!

Obviously, in the rush to spam, the previous poster didn't even read your question.

A VUL is NOT a retirement fund. Generally speaking, you should only consider a VUL option if you are already taking advantage of all of your other tax-deferred options (401k, Roth, IRA, etc.). Otherwise, it just equates to stunting your potential for growth by weighing down your investment dollars with insurance costs. Also, for a $500k policy, it seems that your agent may have you funding it at low to minimum level, which could easily present problems down the road.

Fast forward 10 years from now. You have been funding the VUL at a minimum for the past decade and the economy tanks gain just like it is doing today. Guess what? Due to the huge decrease in your portfolio value, you may get a bill from the insurance company requesting that you send in a large lump sum or you will lapse your policy. Not a good letter to get when times are tough. Believe me, I can hear the VULs imploding across the nation as I write this.

I'n familiar with your other posts and know that you are just beginning to invest and at a realtively low funding rate. On the surface, I would tend to think that the VUL recommendation is inappropriate for you. A ROTH IRA is a much better retirement/emergency savings vehicle than a VUL could ever hope to be.

On a more specific note: Cash value policies are not always a waste of money and can be used effectively...but the needs are specific and the fit has to be the right one for the client.

I agree with pricespector. I would recommend at your age that you not buy term though. Yes you can get a 10-30 year term policy that is going to be cheaper for the first term, but as soon as your term needs to be renewed, you are going to have to re-apply at an older age where you may or may not have new medical problems. You could lock in a low rate in a UL policy for example, and be covered for the rest of your life. I wonder how the agent came up with 500k worth of coverage as well.

Cannot agree more with Learn2invest.

However i disagree with Dan@ACA.

I think that you should purchase a term policy if you can easily afford it. If purchased from a reputable company that deals with securities, you can convert the term policy or increments of it to a VUL.

I, personally, took out a $1MIL Term and have been slowly converting chunks of that term over to VUL as my income has increased. My reason behind this was and remains, that when I had my medical done at age 22, I could be no healthier than I was. Therefore, I locked in Premier insurance rates for my first $1MIL of VUL by getting a term policy for that amount.

You are not ready for VUL right now...don't even think about it. It needs to be funded up to the TAMRA limits to be cost effective and my take is that you do not have that kind of income to invest. Take advantage of your Traditional and Roth IRAs first then buy a house or rental property. You will know when you are ready for VUL when you don't have anywhere else to put your money. You are going to be sold by this guy when he shows you the time value of the money going in because you are starting to invest at a young age. The TRUTH is that it will look WAY better under the same assumptions of investment return on a Roth because there are no fees, M/E expenses or insurance costs built into a Roth.

Kenneth Besada
Insurance/Financial Services
EMAIL: Kbesada@FarmersAgent.com

learn2invest is right. You should definitely do some research first. The best site that I saw with free life insurance info was The Round Table (http://www.theroundtable.org). Check it out, and I'm sure there will be a page that has info you are looking for! Good luck.