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I just met with a lady who had bought "Final Expense" from a very large and well known association for "Retired Persons" she is a member of. She had their term-life version which she thought was smart bcause se heard that term was always better than whole-life.
I ran the math for her:
She bought in at age 56 and is now age 58.
age 56-59 pays 24.77 so that accrues to $891.72
age 60-64 pays $36.88 and that comes to $3,104.52
age 65 to 69 pays $50.75 which brings us to $6,149.52
age 70-74 pays $75.65 and we are now at $10,688.52
age 75-80 pays $123.02 for our final number of $18,069.20
If you live one day past 80 you get a "Thank you for playing card and a We won, you lost button." They also get a chance to try their luck again by buying their "whole-life" policy based on age 80 rates! Nice!
This is for a $20,000 policy. It's even worse for males.
How do these "Retired Persons" groups keep from getting exposed in this day of the internet? What's even more sad is in their TV ads, they offer a free calculator just for requesting the information. No one that understands how to use a calculator would fall for this.
I know what term life is and the advantages of it for young people. But I bbet that very few of these seniors who buy this are aware that they are buying a policy that they lose all their money if they live past age 80. I bet most of thm haven't figured out how much their payment increases (you have to call to get the age 76-80 amount out of them.) And I bet if you asked these people if they are "investing the difference" they would have no clue what you're talking about.
They think it's for final expenses. Final expenses don't end at age 80.
I ran the math for her:
She bought in at age 56 and is now age 58.
age 56-59 pays 24.77 so that accrues to $891.72
age 60-64 pays $36.88 and that comes to $3,104.52
age 65 to 69 pays $50.75 which brings us to $6,149.52
age 70-74 pays $75.65 and we are now at $10,688.52
age 75-80 pays $123.02 for our final number of $18,069.20
If you live one day past 80 you get a "Thank you for playing card and a We won, you lost button." They also get a chance to try their luck again by buying their "whole-life" policy based on age 80 rates! Nice!
This is for a $20,000 policy. It's even worse for males.
How do these "Retired Persons" groups keep from getting exposed in this day of the internet? What's even more sad is in their TV ads, they offer a free calculator just for requesting the information. No one that understands how to use a calculator would fall for this.
I know what term life is and the advantages of it for young people. But I bbet that very few of these seniors who buy this are aware that they are buying a policy that they lose all their money if they live past age 80. I bet most of thm haven't figured out how much their payment increases (you have to call to get the age 76-80 amount out of them.) And I bet if you asked these people if they are "investing the difference" they would have no clue what you're talking about.
They think it's for final expenses. Final expenses don't end at age 80.