Life Insurance for College Savings

[Robert Barney]

I have heard claims, rather often, how Life Insurance, Whole and IUL, can be a better choice to save for college than a 529 plan. To date, I have never read an explanation that satisfied me as to why that is.

With all seriousness can someone explain to me in simple language how and why this could be the case?

Thanks!

This was the post I responded to.

I will reiterate: "Or there's a bank account... "

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The conversation is about what you can exclude from FAFSA. Which isn't much.

I had to look it up:

Free Application for Federal Student Aid (FAFSA)

I suspect people who use whole life insurance, to save for for their kid's college, will need lots of Federal Student Aid.

 

[DHK]

I suspect that someone who had to look up the term 'FAFSA' is in no way qualified to give any professional advice, let alone their opinion on any kind of planning subject whatsoever.

But just for you, here's an image of money under the mattress. With today's interest rate environment, it'll pay about the same as a bank account would.

 

[Robert Barney]

I'm curious.

Doe anyone want to volunteer some details on the last insurance policy they put on a child, to fund a college education, and tell us what the face amount, premium and total cash and/or dividends would be in the policy in 18 to 23 years?

 

[BNTRS]

I'm curious.

Doe anyone want to volunteer some details on the last insurance policy they put on a child, to fund a college education, and tell us what the face amount, premium and total cash and/or dividends would be in the policy in 18 to 23 years?

 

[DHK]

That was... just beautiful! I couldn't have said it better if I tried.

 

[Norwayguy]

I'm curious.

Doe anyone want to volunteer some details on the last insurance policy they put on a child, to fund a college education, and tell us what the face amount, premium and total cash and/or dividends would be in the policy in 18 to 23 years?

Why would you think a policy on the child would be the way to go?

 

[scottstreet]

Why would you think a policy on the child would be the way to go?

because he doesn't know what he doesn't know...

 

[Larry Tew]

I'm curious.

Doe anyone want to volunteer some details on the last insurance policy they put on a child, to fund a college education, and tell us what the face amount, premium and total cash and/or dividends would be in the policy in 18 to 23 years?

Sigh. That's all. Just sigh.

 

[LGilmore]

Bob?

When you stated "there still a bank account."

What you didn't understand, which isn't all that unusual is we were talking about what you can EXCLUDE from FAFSA and a bank account isn't one of them.

And I agree with the others here is should you be commenting on something you know zero about?

And just to help you out a bit, almost every place of higher learning public and private require parents to do a FAFSA. You see there is more than just determining how much a parent should pay for their kids education involved.

Both my kids had substantial scholarships (roughly 250k between them) and we were expected to fill out FAFSA as part of the enrollment process.

This might have been a thread better read by you than commented on. But hey, that's never stopped you before.


edit: We were expected to do FAFSA even while on scholarship because if we qualified for any governmental assistance, it would replace part of the scholarship dollars so those dollars could be used for another student. We did FAFSA but were never expected to pay what FAFSA said we should. Instead our situation allowed the universities (both private) to take advantage of available higher education dollars. This allowed them to use those freed up dollars for other students.

 

[ncaggie]

That was... just beautiful! I couldn't have said it better if I tried.

Ya but it would be nice if yall answered it, because I had the exact same question.