Forum: money.stackexchange.com
Tags: <insurance><investing><life-insurance><whole-life><universal-life>
Title: Why should I invest my money in a life insurance policy?
Question: As i am 24 now i get lot of calls from lot of insurance companies asking to take up an insurance policy.... So i decided to get answers for some of my questions in basicallymoney...   Why should i invest my money in insurance?  What age would be appropriate for investing money in insurance?

Answers:
sents: text: John's answer is similar to what I was thinking.
text: You should invest in insurance "because there's an insurance salesman who needs to pay to send his kid to college."
text: I will never be a fan of any type of permanent insurance, and I think it wrong to sell a single person with no dependents such a policy.
text: I've used the expression "Variable Annuities are sold, not bought.
text: " I feel the same about these insurance policies.
text: The best advice I can offer in a short reply is this: If you need life insurance, buy term.
text: Save as much as you can, 10% minimum, more if you are able.
text: A young person should be saving for retirement and to position them self to buy their first house, if that's what they wish.
text: What good is a full up Whole Life policy when you need to raise $40K to put down on a house?
text: Sorry to sound like I'm lecturing, this is one of my hot points.
answer_details: author: money.stackexchange.com/users/187/JTP - Apologise to Monica
score: 28
sents: text: I can tell you the reason the people who are calling you think you ought to use life insurance as an investment.
text: What they will tell you : It is a way to avoid taxes.
text: What they are thinking
text: : It is a way for me to sell an investment with a huge commission.
text: Whole life insurance as an investment really doesn't make sense for all but a very small minority of investors.
text: If you have people that depend on your income to survive, buy term life insurance.
text: It is much more practical and affordable.
answer_details: author: money.stackexchange.com/users/149/JohnFx
score: 19
sents: text: Who depends on you?
text: I personally wasn't insured until I had a family.
text: Of course I had the required insurance policies like auto, but no health until I was 29 and had a kid who needed me.
text: Now I have health, dental, vision, life, auto, homeowners and renter's insurance.
text: I can't let an accident or disaster affect my baby's future.
answer_details: author: money.stackexchange.com/users/91/MrChrister
score: 15
sents: text: Insurance isn't an investment.
text: It's a hedge against your untimely death, and is meant to replace the potential income that will be lost by not having you there to provide for your family.
text: Buy term, and invest the difference.
text: Traditional investments will outperform the insurance fund, as well as offering more flexibility.
answer_details: author: money.stackexchange.com/users/1739/Benjamin Chambers
score: 10
sents: text: As a 24 year old, single,your needs for insurance are minimal.
text: Why you might consider it are for these reasons.
text: You are young, so it will be cheaper than buying say at 34.
text: Insurance is always on sale.
text: Two, there is no guarantee that your health will always be good, you may have to pay additional premiums later or even be refused coverage.
text: Ask me, I pay 70% more than others my age for the same coverage.
text: Three, insurance ownership with equity values can grow tax free as you accumulate the monies.
text: Consider it like a bond portfolio offering guaranteed returns on portions of the growth, and a long term return of 5.5% or slighly more.
text: Four, stating sooner versus later means more cash buildup.
text: Just like being in a pension will generate more cash for you by age 65, than if you had started at age 34.
text: Insurance is only one tool in getting a good start.
text: It is not a panacea.
answer_details: author: money.stackexchange.com/users/477/Gary Gorr
score: 7

Summary of the answers:
It is better to buy term life insurance and then invest the difference. However, you need for insurance at your age are minimal and you could wait until you have a family.
You may wish to buy term life insurance if you have a family or dependents. In all other cases, there is little point.