Don’t be fooled. Suze Orman gives very harmful advice in steering this caller away from getting a whole life insurance policy and I’m gonna break it down to you why. First of all I agree with Suze on this point; life insurance is not an investment, or at least the traditional sense of investment. That’s a misleading tactic slimey insurance agents use to convince people to buy insurance, and is illegal to state. I whole heartedly agree with Suze.
Where Ms. Orman is dead stanking wrong is telling this person term insurance is better than whole life insurance. Let me break it down. Whole Life insurance is in force for your whole entire life. It never expires unless you stop paying the premium. The rate never goes up unless you decide for it to go up. Term Life insurance is insurance for a specified term. 10, 20, 30 years. After that term is up, if you die, nobody gets anything! The insurance company keeps your money. So for example, let’s say Suze’s guest, Deepak is 30 years old. Let’s say he gets a Term Life Insurance policy for a 30 year term which is the typical maximum term. Now, let’s skip ahead 31 years when good old Deepak is 61 years old with his wife and kids. If he dies at this age of 61, or any time after that, nobody gets squat. Is that what you want?
- In force for your entire life, never expires
- Premium never goes up unless you want more coverage
- Accrues cash value
- Automatically accrued cash value can be used to pay missed premiums so policy doesn’t lapse
- More expensive
Term Life Insurance overview
- expires after term is reached
- after expiration date, re-issuance is not guaranteed
- less than 5% of term policies pay out because people outlive their term
Here’s the part that really sucks for Deepak. Let’s say he does get the term policy at 30. Then let’s also at 61 he doesn’t die, but he his policy has expired. He now has to go out and try to get more life insurance. One of two things are gonna happen:
A) He finds some coverage but since he’s 30 years older the coverage is much more expensive than before. (The younger you are, the cheaper it is.)
B) In the last 30 years he has developed some kind of health condition that makes him too high a risk for an insurance company to take on, so now he is uninsurable.
Both of these situation suck. And Suze Orman knows this. Suze Orman should be ashamed of herself giving this poor harmful advice to people. It’s dangerous. You wind up buying coverage, thinking you are covered, and when the time comes when you and your family need it, it’s not there. There is a better smarter approach to life insurance. We go into this and much more in my quick easy to read book:
This book is written for the person who wants simple straight guidelines on how to buy insurance and what to look for, from someone who isn’t trying to sell it to them and is an industry professional. It’s a fast read that will give you enough understanding to sit down with an insurance agent and know if what he’s saying is BS or not, and most importantly, take care of you and your family. Click on the Amazon link above or right here to get your copy today at a reduced promotional cost. Less than $5.00!! I wish you and your loved ones luck.