My dad and mom are 65 and have a term life insurance policy that is expiring this year, he was paying $90/month for the last 20 years, and the premium is about to go up to $285 for a 250k policy. Neither of my parents have major health issues, though their own pessimism makes them think they won't live another 20 years, but at that time the policy could go up more.
They're trying to decide if they should do it.
Another factor is my dad has two pensions, one from the Marines and one working for the county, for 20 years each. He had an option to allow my mom to continue collecting his military pension if he died first, but it was going to cost about a quarter of his retirement for that option at the time so they didn't do it.
So they're basically trying to prepare for the possibility of my dad dying before my mom. They have a house worth about 400k that's paid off and about half that amount in savings.
Any thoughts on the best option? Not sure how to figure out if it's worth if for them to keep it, because we don't know who will live longer, and have to consider inflation, the interest they would receive on their money instead of paying the premiums, etc.
Any thoughts?
original posted by PurplishDev to r/personalfinance on Wed, 03 Apr 2024 15:21:36 GMT.