I know this is an age old question, but I really would like guidance on what I should do here. I’m a 28 year old single male with no kids, so I know right there most people say I don’t have a need for life insurance. However, I am really interested in being financially stable when I’m older. I have a 401k plan and will get an IRA (possibly Roth) after I leave my current job next year, but those aren’t going to be available to me until I’m 65-70 and I plan to retire in my 50’s at the latest. Also, those investments are taxable once I withdraw.
I have an uncle who says he’s looking out for me by offering me Custom Whole Life Insurance policies. They are very expensive compared to term policies, but the benefits are that they are self completing in the event of a disability, the values only go up and don’t fluctuate with difficult economic times, and the interest payments to you once they are paid up are tax-free. Two possible scenario’s are below. Any thoughts are appreciated. Thanks!!
1) CWL with $100,000 face amount. Annualized premium of $1,567.08 ($130.59/month) payable through age 55. Potential tax-free annual payments starting at age 56 of $4,179.
2) CWL with $400,000 face amount. Annualized premium of $5908.44 ($492.37/month) payable through age 55. Potential tax-free annual payments starting at age 56 of $16,389.