Cancel life buy term?

I have thought about the same thing as you before.

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So I met up with a few agents to talk about it. The answer for me is not only about how much I pay in total. The balance for me is cash paid, cash returned and risk management.

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On cash paid for whole life, its returns are definitely not good plus with inflation, your value is wiped out. Which brings you to term.

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On term, the amount is definitely lesser so if you are able to invest the amount saved to make higher returns, then i would say go. But the coverage needs to be sufficient.

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Last on risk management. Protection is important but don't over insure yourself. The key is to put your money to the best use.

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Lastly, I believe you have a good idea what to do. Just find the balance then yearly see if you need to rebalance. At every different life stage, you need to look at it again. Personally, this is the time of the year where I also look at my own situation and rebalance.

Hi anon, you may consider buying another life plan with shorter premium term especially since you're young now, cos the premium for life plans will just keep increasing the older you get.

Life plans generally have cash value but term plan do not.

So although you are paying way lower for higher coverage in terms plan, all the money will be thrown down the sea when there's no claim (and ofc no claim is best scenario cos it means you're healthy)

But for life plans, after the limited premium term whatever you put in the policy will still have cash value when there's no claim. So the longer you hold on to the policy the higher chances for you to breakeven and get back your money should you want to surrender in the future.

Life plans now also tend to have CI coverage, so should you really need the money for treatment etc. can claim.

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At the end of the day, just see how much you are comfortable to set a side and work with an advisor you can trust to work on a solution. Cos ur goals and priorities will definitely change as u grow older, and ur advisor will definitely have some insights that can help u make a better decision.

Hi anon,

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You probably have an older life plan from the 2000s which, at that time, was payable for quite a few years.

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Don't cancel it first. Obtain the revised policy illustration and study the numbers carefully. I suspect your coverage is already $50K and can only continue to climb over the years especially when we take into account the reversionary bonuses that have been credited to the plan.

Both have its pros and cons