Life Insurance, wills, other financial/legal stuff?

Snaps816 · May 2016

I don't believe we have a thread for this stuff yet, and I can't be the only one wondering where to start!

This is something I know we're supposed to sort out before baby comes, but I have no clue how to shop for and evaluate insurance products! DH and I once sat through a TransAmerica sales pitch -- but that was this crazy scheme where you use life insurance as an investment. The monthly payments were huge! I know we don't need that, we just need an affordable policy where if something happened to either or both of us, the other, and our son, would be taken care of. Does anyone have any recommendation of where to start? Or a specific company that is good?

The matter of the will seems simpler to me -- I was thinking that, because we don't really have much in the way of assets, we could just use Legal Zoom or something to draft a basic will. Or, if that seems insufficient, hire an attorney. We don't exactly have a huge estate to worry about, LOL.

ballofmeat · May 2016

How ironic that you posted this today! DH and I were just discussing this!

We have a lawyer program through work that is available for all employees to use at a small fee. I think this is what we are going to use to draw up a will once baby is born.

As far as life insurance, I shopped around for the best premium rate a few years back for a term policy. Now that I am married and have a LO on the way, I will be converting it to a whole life policy with no penalties or health re-check. Premiums also vary from place to place based on your health screening and what the underwriters evaluate that at.

I think we will take a small policy out on LO as well. DH's parents took out a whole life policy on him when he was born and have been able to slowly increase it over the years. Thank goodness they did because DH has had MAJOR health issues in his life and because of that would not qualify for a majority of policies, if any at all.

SkiChic626 · May 2016

This is going to sound crazy, and I was skeptical at first, but try SelectQuote. My aunt, who is a big shot actuary and works with this stuff, actually recommended that we used SelectQuote for our life insurance. They gave us several options and did all the leg work for us as far as life insurance goes. We got our life insurance, though, when we bought our house - baby came about 18 months later. Ours was a little complicated because even though we were in our 20s at the time, we had a hard time getting DH approved because he had meningitis when he was 21 causing him to have a stroke, a heart attack and be in a coma for 2 weeks....crazy, I know. But because it was within 10 years, we had to disclose it and then go through all this rigamarole to prove that it wasn't because of poor health, it was caused by the meningitis and he wasn't at increased risk of it happening again due to health. My only other recommendation would be to never buy whole life insurance, especially as a young person, it'll always be cheaper to get term life insurance, even if it's a 20 year policy....the motto is "buy term and invest the difference," you'll always fare better financially this way. Then in 20 years you just do the process again, which really isn't a huge deal, as you'll more than likely be in your 40s by then and still in good health.

texasmama2014 · May 2016

My husband is a financial planner. When you were looking for someone to sell you your insurance products, you definitely need to find someone who is an expert in their field. I don't want to name drop but there is a company where their representatives typically work as a "side" job. The reps sell really bogus policies that are really hard to get out of.

We personally have $700,00-800,000 term insurance on each of us. It is very important that we would be taken care of in the event of one of our deaths- payoff our land and house(or pay to build it if it's not done yet), pay our children's college, and any debt. Currently, we have a whole life insurance policy on DD. I think it is about $25,000. Besides life insurance we also have disability. Our health insurance is through my job, but if something happened to me or I left my job at his company would provide similar coverage for similar cost. We are also those weirdos who have long-term care insurance and have had it since I was 26. I recommend having a person you trust (DH has only been in the business for a year, but we have worked with the company since 2011.) It also helps if the person you can trust can also do things like Roth IRA's and 529 college funds for the kiddos.

As far as a will we have recently found a lawyer and are ready to put our wants into writing. It has already been made known that my sister and her husband will get DD in the even that both of us pass. Their religion and beliefs aligns with ours, and DD is comfortable with them. They live in the area and we feel they are the best choice. If we were to all go we want everything split evenly between both families.

Nikkoli98 · May 2016

@texasmama2014, is your disability insurance through your job or a private policy? Does you husband recommend strongly either way?

Edited: the app cut off my post except for the first sentence.

ballofmeat · May 2016

@SkiChic626 What a pain in the butt to go through for life insurance for your husband! Glad he ok now.

We tried about two years ago to get an additional term policy on DH because he can only increase his current policy coverage every two years by 25,000 for a max cap off of 200,000. He was denied two different places because of his health history, which just really sucks. I guess in my mind now because of this, signing up for life insurance while younger is the best route to go.

I do agree it is probably best to go with a term policy while younger as they are cheaper and most places have an option to convert if you choose to.

jenna8984 · May 2016

We currently have life insurance that covers our mortgage, car payments, and has about 50k leftover for savings. The other person would be able to keep working and only pay for things like groceries, cable, taxes, etc. But we definitely plan to double our policy amounts after the baby is born so that it will leave enough in the bank for college and overall child expenses. I really like my car insurance company so I just got the life through them as well. Just to give you an idea, ours is $40 each per month for 250k coverage. H got a slight surcharge for quitting smoking less than 5 years ago, and I got a slight surcharge for having high cholesterol. If you see commercials that say like "$10 a month" then it's for barely any coverage on someone who has PERFECT health.

We don't have wills yet because we're waiting until after baby is born. If we write one right now it wouldn't be able to list him by name and who would care for him, and money in a trust for him. So my lawyer friend offered to do it for like $300 after the baby is born. I haven't called around so I have no idea what the going rate is but I think it's more like $1,000 around here.

MamaKSquared · May 2016

We currently have term plans through each of our employers. Both companies automatically give us 1x our annual salary, with an option to get additional coverage for extra. Our companies also supplement that, so it's really cheap. I realize if we leave our jobs, we'll have to find a new policy, but it's so much cheaper than any other option out there. I pay $6 a month for mine and I would leave behind enough to pay off all our debt (just our house and 2 cars), funeral expenses, and extra to help with bills, etc. Now that we have a LO on the way, we'll plan to increase our policies, but we will probably still keep them through work.

We talked about wills when we purchased our first home, but we never actually did one. Now that there will be a child involved soon, it's definitely moved up on our to-do list, but we still need to make it a priority.

charmedlifex3 · May 2016

If you know a financial advisor (ask your parents if they work with someone, if you don't.) a lot of times they can answer a bunch of these questions / recommend lawyers for wills / help you get 529 plans established. The 529 offered by your state MAY offer you a tax advantage, but some states don't and some plans offer a better ROI (so the money grows more tax free, which gets you more of a benefit.)

The lawyer we use suggested I wait until after the baby is born to change my name on the house / add my husband to the house, and he would do it all for a couple hundred - including drawing up wills for us both.

Make sure you talk to who ever would be taking custody of your child before doing this.

Also - I talked to someone from a local insurance firm, and she was able to get us better rates than I could shopping around too. Our home owners policy was like $500 cheaper - that's real money. I was able to get long term disability for $500 / for the year (there was a slight discount since we paid it in a lump sum too!)

Right now we have about 200k life on me, and only about 30k on my husband. It's provided through my work, and I am the only one earning money at the moment so it's less crucial from a FINANCIAL point of view if I couldn't replace his income than if he couldn't replace mine.

bearsandbeets7 · May 2016

We have our life insurance through DHs company so it's the same company that our health insurance is through. We have $100,000 on both DH and me and an additional $50,000 on us as well. We have $25,000 on DD and will do the same for this LO.

It just adds in to the total amount taken out of DHs check every two weeks but I think it's around $10 so not bad. We don't have many assets, just my car which is paid off. We rent our home right now but I think now that we have 2 kids we probably need to lay something out as far as who will take care of them if anything were to happen to us. It will probably be my parents but we need to do something concrete so there wouldn't be any issues with my inlaws.

charmedlifex3 · May 2016

Oh! and something super simple - before we give birth, for any individual accounts you have, you can fill out a form which is a "transfer on death" form at your bank. If anything were to happen to you, this avoids probate, and would give your beneficiary near immediate access to the accounts.

I put my husband on as a TOD beneficiary, since I keep all the bill money and savings in an account in just my name. (He's really bad with money, lol) Usually you'll need your beneficiaries social, name and date of birth, and that is it.

Not nearly as comprehensive as a will, but at least if something happened there wouldn't be money sitting frozen waiting on probate. (And wills do need to go through probate in most states. I know in NY I have seen it take months - timelines vary by state)

Curls919 · May 2016

We just got life insurance after DS was born. We used a Financial Planner who technically works through MetLife but he could sell policies from any company (he got quotes and got us the best deal). I'm pretty sure my plan uses investments though.

We still don't have wills. We started doing them using LegalZoom but we haven't gotten them notarized. We need to do that.

Ceventa · May 2016

DH and I have a term life policy in addition to what we get from work. We got them when we first got married and lived in our first house. I have been thinking of calling and having them reevaluate our coverage now that we have two kids and a new house. We also need to get going on our wills, whenever I think of this "to-do list item" I always kick myself because it's so important and we still haven't tackled it. Finding the attorney to do it is the struggle.

texasmama2014 · May 2016

Nikkoli98 said:

@texasmama2014, is your disability insurance through your job or a private policy? Does you husband recommend strongly either way?

Edited: the app cut off my post except for the first sentence.

I have both. If you're the main breadwinner he would probably recommend getting the employer plus a supplement. If you are not, he would probably recommend getting just the employer if offered. It's much cheaper through group, but often doesn't cover enough (50%).

DisneyIsabelle · May 2016

A will is on our to-do list as well. I'm not sure if we could just use a template or online program like nolo or legal zoom since it would be fairly simple assets and guardianship stuff.

I do think my husband should get additional life insurance to what he has through his work. I'm not sure if I should? I'm self employed. We also should probably get some sort of disability insurance for my husband in case he gets injured while he's not at work?

texasmama2014 · May 2016

@DisneyIsabelle if you depend on your income to pay bills, I definitely would get both. It's definitely a conversation with your husband before the baby is born.

Snaps816 · May 2016

So much to think about! Tonight I told DH he needs to take the lead on these things. Not because my little lady brain can't handle them, but because I am already doing battle with the insurance company, most of the shopping and gathering of baby things and... oh yeah, carrying the baby inside my body. But I'm going to make a list of all of the suggestions you've all provided here and sit down with him to review.

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