I did this with a universal life policy I bought from USAA decades ago. As the value of my savings and investments increased throughout my working years, and once the kids were through college and one their own, and the house was paid off, I didn't feel I needed as large a death benefit. Furthermore, the annual premiums to maintain my death benefit were about to skyrocket (like your dad's). So I reduced the death benefit from 500K to 300K. That is enabling the policy to "coast", with accumulated cash value "inside" the policy paying the premiums for a few more years, until I'm 67, 4 years post retirement--long after the point where I am "self-insured."[
5. Is there any sort of middle ground where we can maintain this policy with lower premiums (and a potentially lower death benefit), or is it an all-or-nothing scenario at this point?
I still had cash value in it when I reduced the death benefit. Your dad's policy does not. You will have to pay *something* to jump-start the policy. Presumably less if you lower the death benefit. How much less? Your agent should be able to give you an illustration, like the above, under that reduced-death-benefit scenario.
Statistics: Posted by syc — Thu May 09, 2024 9:47 pm — Replies 20 — Views 1149