Planning for a couple - 2 vs 1 wholelife policy

[SParker]

This is for retirement/estate planning purposes, the couple has no children.

If the wife is younger and have better health than the husband, then it makes more sense to have just 1 policy with the wife as the policy owner as opposed to designing one policy for the husband and one for the wife, correct? This way premium will be less and the policy will be more efficient.

If the wife passes first, husband will be well taken care of by the DB.

If the husband passes first, wife can take a lifetime tax free income and she will be well taken care of too.


The one potential downside is that if the husband passes away in the early years before the policy has time to grow, the wife will have nothing.to fall back on. But that can be taken care of by having the husband take out a term policy with the wife as beneficiary.

Makes sense? I really can't think of a reason to take out 2 WL policies for the couple.

Any feedback would be appreciated.

 

[Robert Barney]

This is for retirement/estate planning purposes, the couple has no children.

If the wife is younger and have better health than the husband, then it makes more sense to have just 1 policy with the wife as the policy owner as opposed to designing one policy for the husband and one for the wife, correct? This way premium will be less and the policy will be more efficient.

If the wife passes first, husband will be well taken care of by the DB.

If the husband passes first, wife can take a lifetime tax free income and she will be well taken care of too.


The one potential downside is that if the husband passes away in the early years before the policy has time to grow, the wife will have nothing.to fall back on. But that can be taken care of by having the husband take out a term policy with the wife as beneficiary.

Makes sense? I really can't think of a reason to take out 2 WL policies for the couple.

Any feedback would be appreciated.

I'm lost. Why do either of them need a life insurance policy?

Break it down for me.

If he dies, what is her financial problem?

If she dies, what is his financial problem?

 

[SParker]

If he dies, what is her financial problem?

If she dies, what is his financial problem?

The wife brings in the bulk of the household income for the family, so if she dies, the husband will not be able to support himself. The policy's DB is very important to the husband in that regard.

If the husband dies, I suppose the wife will be OK for as long as she can continue to work, but she cannot work forever, at some point, she will need to retire, so I thought a properly designed WL policy can accomplish both goals, ie: giving husband a DB if wife dies first, or wife draws a lifetime tax free income for retirement if husband dies first.

Does that make sense?

 

[Robert Barney]

The wife brings in the bulk of the household income for the family, so if she dies, the husband will not be able to support himself. The policy's DB is very important to the husband in that regard.

If the husband dies, I suppose the wife will be OK for as long as she can continue to work, but she cannot work forever, at some point, she will need to retire, so I thought a properly designed WL policy can accomplish both goals, ie: giving husband a DB if wife dies first, or wife draws a lifetime tax free income for retirement if husband dies first.

Does that make sense?

OK, so you are tying the need for insurance to the need to replace a lost income in the event of a premature death. I understand that, but you could use term to do that. Cover them with term until they get to the age they plan to retire, and it quits when they do.

What other alternatives have you considered with regard to saving for retirement?