my mom said i have life insurance that I can cash out, should I cash out?
filed in finance on Feb.01, 2010
My mom said i have life insurance that I can cash out, should I cash out?
What is she even talking about? What kind of life insurance do I have? Im over 21 yrs old, so I can cash out, but I was told not to do it– I just have no idea what anyone is talking about bc I thought you just paid a monthly/yearly fee for life insurance like you do on car insurance or health insurance. My parents are very wealthy– how much could this be worth?
February 1st, 2010 on 1:06 am
my parents took out a life insurance policy for myself and my 2 siblings when we were babies. i believe at age 21 it was "paid up", meaning no more payments were due. the policy was for $1,000 and by the age of 21 had a cash only of about $1,700, so i never cashed it and it now pays premium to buy more insurance which is around $3,500 now. most likely the policy would be no more than $10,000 is my guess since the only reason a parent buys life insurance on a child is for funeral expenses. ask your parents for the name of the company and policy number and you can call them to find out. good luck
February 1st, 2010 on 1:06 am
You need to start with your parents. Ask them who the policy is with.There are many policies that parents start when they have children. Gerber Life is a policy that parents can take out on their children and when the child reaches the age of 21 they can either cash out or roll it over into an adult plan.Only your parents know the information that you are asking about because they or your grandparents are the only ones who can legally take a policy on your life.There are several different types of life insurance term – the one your talking about pay a premium have that amount paid to a beneficiary upon death. Then there is whole life which you pay into for a period of years but it builds equity that you can borrow from later and it can also make the payments at that time to reinvest. There are many types for use as a long term investment and death payout.Your parents are wealthy you say so your policy can be for say as little as $10,000 up to the sky. They are the ones again to ask. Get the company name and policy number, now that you are 21 or over you will have to do something with it.I would recommend cashing it in and getting a term policy. If your like your parents you will make something of yourself in this life and have other better long term investments.Hope it helps and good luck.
February 1st, 2010 on 1:06 am
What made your mom bring the policy up to you? Why did she mention cashing it out? If your parents are wealthy they are either good with money or know people who are. Ask their advice. Learn from what they've learned and experienced. They will be the best people to help you learn about the policy that you have and what you should do with it. People on here don't know anything about you or your situation. Please let me know if you have any questions. Source(s): http://www.evolutionofwealth.com
February 1st, 2010 on 1:06 am
It's probably worth a couple hundred bucks. DEFINATELY not worth throwing good money after bad. But only the policy owner can cash it out. So unless mom turned over ownership to you, it's a moot point.