Quote:
Originally Posted by Rick Lee
Met a guy three weeks ago who was still paying on a policy he took out in 1971. He said he had a $2000 loan against the cash value, but was adding $20/mo to his payment to cover that. We called the company, turns out the loan is $7k and his $20 doesn't cover half the interest, let alone the principal. So his cash value is getting devoured like termites. He was better off cashing out and starting over, even though he's 50 yrs older now. This is why he's poor.
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This guy has been paying for life insurance for 50 years. What if he had invested those premiums into a S&P fund? Is there any way to calculate how much he's paid into this thing for 50 years? Sounds like these predatory insurance scams are the issue. Scummy business.
Also, what if he stopped paying today, what happens? What is his cash value before the $7k loan? If he stops paying today, and dies 5 years from now, his beneficiary gets the cash value when he stopped paying? Or do they get $0 ?