Matthew Perry Sells Malibu Beach House for $13.1M

Matthew Perry of “Friends” found a buyer who was there for him. He has successfully sold his Malibu, CA, beach house for $13.1 million.

Perry had initially listed his “kick-ass Malibu home”—as he called his place on social media—in August for $14.95 million. In September, the actor dropped the asking price by a million dollars, to $13.95 million.

He then slashed the price one last time to $12.95 million. That reduction attracted a buyer, who scooped up the swanky space for just a little over the ask.

Although the price ended up lower than his initial asking price, Perry came out ahead. The savvy star picked up the the property in 2011 for $12 million.

Perry reportedly bought the beachfront abode from the Southern California developer Scott Gillen, who completely transformed the circa-1960 build.

The result is a loftlike space with expansive walls of glass, looking out to the Pacific Ocean.

The fab pad can hold lots of friends, with two floors, four bedrooms, and 3.5 bathrooms on 5,000 square feet. The main level features an open living and dining area, a fireplace, beamed ceilings, and sparkling views of the ocean. The glass walls completely open up, extending the living area out to a deck that runs the length of the house on both floors.

A floating wood-and-steel staircase leads to the lower-level master suite, which includes a sitting area, walk-in closet, and luxurious bathroom.

The home also features an outdoor spa and a state-of-the-art home theater.

Meanwhile, the deck comes with plenty of seating and a fire pit, perfect for catching the sunset.

The open floor plan made the buyer swoon, according to Luis Robledo, the Douglas Elliman agent who represented the buyer.

“The minute you walk through the front door, you have a completely open and expansive view of the ocean, with floor-to-ceiling and wall-to-wall windows,” Robledo says. “Two decks on both levels spanning the length of the home—maximizing the outdoor space—also made it extremely compelling. This is the perfect getaway place.”

Perry took full advantage of the beach pad as his personal getaway during the pandemic. He posted photos to his Instagram account from the property as he hung out on his deck or baked cookies in the kitchen.

Perry had been on a selling spree, also placing a posh penthouse on the market in Los Angeles in 2019 for $35 million. In 2017, he bought the “mansion in the sky,” which occupies the entire 40th floor of the Wilshire Corridor’s elite Century Building, for $20 million.

He renovated the place to his taste, with what looks like wall-to-wall velvet furniture, a huge master suite with views, and the home theater. The listing is currently off market.

Now that he’s freed from his real estate concerns, the star’s new focus appears to be an adorable puppy.

Luis Robledo of Douglas Elliman represented the buyer. Joshua Flagg with Rodeo Realty repped the seller.

Source: realtor.com

Will There Be Relief for Private Student Loan Borrowers?

Over the past year, more than 20 million federal student loan borrowers have been able to pause their payments to cope with pandemic-induced financial stress — a postponement that President Joe Biden recently extended through September 2021.

But those who have private student loans? Not so much.

Private student loans represent about 8% of total education debt, according to MeasureOne, which tracks data on private student lending. Not only are these borrowers left out of the payment pause granted to federal borrowers, they’re also rarely included in ongoing conversations about loan forgiveness.

The only mention of private student loan borrowers in relief proposals has been as part of the Heroes Act Oct. 1 update — it included a measure that would have paid off $10,000 of loan debt for economically distressed private student loan borrowers. However, it didn’t find traction then and didn’t make the December 2020 relief package or Biden’s most recent proposal.

Betsy Mayotte, president and founder of The Institute of Student Loan Advisors, says borrowers shouldn’t expect relief to come from Congress.

“I think the moment to help those borrowers unfortunately has sort of passed,” Mayotte says, though she adds that she’s not hearing from troubled private loan borrowers any more often than usual.

That doesn’t mean private student loan borrowers aren’t now facing headwinds or hoping for some kind of relief. But federal loans fall under the purview of the federal government, and any relief there affects far more borrowers.

That’s why Robert Kelchen, associate professor of higher education at Seton Hall University in South Orange, New Jersey, says federal student loan forgiveness stands a better chance of happening. He says private student loan debt forgiveness is “a possibility,” but unlikely.

“Most people with private student debt also have federal student debt, so [private loan borrowers] probably wouldn’t get anything forgiven,” Kelchen says.

One change that might help: bankruptcy reform

Mayotte says she thinks there’s “good potential in the next two years” for a change in bankruptcy rules for student loans, adding that an appetite to do so exists on both sides of the aisle.

Recent court rulings and a bankruptcy reform proposal by Biden indicate a shift is already happening toward making it easier to dismiss student loans in bankruptcy.

Currently, courts have high standards for proving “undue hardship” that would result in loans — whether federal or private — being discharged. Pursuing bankruptcy is also cost-prohibitive for many borrowers to attempt without the security of knowing they can win.

But it’s harder to prove undue hardship with private loans since they don’t have as many safeguards as federal loans do, such as income-driven repayment.

Fewer private borrowers seeking relief

Private student loans, unlike federal loans, are underwritten using traditional credit standards, and over the years their default rate has been much, much lower — less than 2% annually, according to a 2019 MeasureOne report.

At the start of the pandemic, private lenders offered borrowers experiencing financial hardship short-term emergency forbearance or deferment or a temporary lower payment amount.

Relatively few borrowers took advantage of them. MeasureOne found fewer borrowers were using forbearances during the third quarter of 2020 (July, August and September) compared with the previous three months (3.68% versus 7.04%, respectively). It’s worth noting that many of the special forbearances were available in 90-day increments only.

A NerdWallet survey of 30 private lenders found virtually all requests for short-term forbearance during 2020 were granted.

  • Ascent said 2.8% of its student loan portfolio requested an emergency forbearance and 100% of those requests were approved.

  • Among Funding U borrowers, less than 5% requested a forbearance and 100% of those requests were approved.

  • Splash Financial reported 1.7% of its borrowers requested a special forbearance and 93% were approved (borrowers were rejected if they didn’t provide requested documentation).

Most lenders who responded to NerdWallet’s questionnaire said they weren’t currently reporting delinquent accounts to collections, and among those who were, the reporting rates were low. For example, Ascent reported 0.9% of its portfolio had gone to collections.

Some of these special relief options are continuing into 2021, but several lenders have already sunsetted their programs.

In those cases, borrowers must rely on existing options. That usually means requesting regular forbearances lenders already offer, which carry limits (typically around 12 months, but some offer double that). If you have private student loans, contact your lender to find out what it offers.

For private borrowers who are facing financial trouble, this relief may not be enough.

Seth Frotman, executive director of the Student Borrower Protection Center, a nonprofit based in Washington, D.C., questions whether private lenders are doing their part.

“Companies are making all of these promises about supposed help in the face of the pandemic, and we have heard time and again from borrowers that they’re getting bad information, no information, conflicting information or the total runaround about how you can get access to these programs,” Frotman says.

Source: nerdwallet.com

You’re Probably Cooking This Food the Wrong Way

Woman cooking food on her stove
Photo by Quality Stock Arts / Shutterstock.com

If you eat rice, you likely are ingesting arsenic, a known carcinogen that impacts virtually every organ in the body. Arsenic exposure has been linked to:

  • Bladder, lung and skin cancer
  • Diabetes
  • Heart disease
  • Lung diseases
  • Skin lesions
  • In utero impacts on a developing immune system

Because arsenic is water-soluble, it accumulates naturally in rice grown in flooded fields. But a recent study has found that cooking rice in a specific way removes up to 50% of the naturally occurring arsenic in brown rice, and 74% in white rice, while retaining most of the grain’s nutrients.

The trick is to cook the rice using a method known as “parboiling with absorption,” say researchers at the Institute for Sustainable Food at the University of Sheffield in England. This involves a few steps:

  1. Add water to a pot — using 4 cups of water for every cup of dry rice that you plan to cook — and bring the water to a boil.
  2. Add the rice to the boiling water and let the rice boil for five minutes.
  3. Drain and refresh the water, this time using 2 cups of water per cup of dry rice.
  4. Cook the rice on low to medium heat until all the water is absorbed.

For years, experts have been concerned about the level of arsenic found in rice.

A 2012 Consumer Reports study discovered measurable levels of arsenic in nearly all of 60 rice varieties and rice products the publication tested. Follow-up research was even more troubling. According to CR:

“We found that rice cereal and rice pasta can have much more inorganic arsenic — a carcinogen — than our 2012 data showed. According to the results of our new tests, one serving of either could put kids over the maximum amount of rice we recommend they should have in a week.”

So, aside from cooking the rice the right way, which rice should you buy?

Brown rice — which is unmilled or unpolished and retains its bran — contains more arsenic than white rice. Unfortunately, though, the same milling process that removes arsenic from white rice also eliminates 75% to 90% of the rice’s nutrients, according to the University of Sheffield researchers.

Consumer Reports says that as a general rule, white basmati rice from California, India and Pakistan, and sushi rice from the U.S., have half as much inorganic arsenic as most other types of rice, on average.

Meanwhile, brown basmati rice from California, India or Pakistan has about one-third less inorganic arsenic than other types of brown rice, CR says.

CR also suggests steering clear of rice from three U.S. states in particular:

“All types of rice (except sushi and quick cooking) with a label indicating that it’s from Arkansas, Louisiana, or Texas or just from the U.S. had the highest levels of inorganic arsenic in our tests. For instance, white rices from California have 38 percent less inorganic arsenic than white rices from other parts of the country.”

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

Register for the FREE Influence & Impact Summit Online Event!

October 7, 2015 | Crystal Paine

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Register for the Free Influence & Impact Summit

If you have a business you’re trying to get off the ground, you’ll want to register for the Influence & Impact Summit! This is a FREE online event that features over 20 speakers to help you learn how to maximize your influence and impact with your business or brand.

I was so honored to be invited to speak at this event, alongside a group of 20 other successful entrepreneurs who have SO much wisdom to share!Speakers at the Influence & Impact Summit

You can go here to register for this event for FREE. You will be able to watch all of the online presentations during a time that works best for you, but you must watch all of them before October 13, 2015.

Subscribe for free email updates from Money Saving Mom® and get my Guide to Freezer Cooking for free!

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Source: moneysavingmom.com

7 Things to Know Before Taking a Work From Home Tax Deduction

If you’re one of the millions of workers whose home is now doubling as office space due to COVID-19, you may be wondering whether that means a sweet deduction at tax time. Hold up, though: The IRS has strict rules about taking the home office deduction — and they changed drastically under the Tax Cuts and Jobs Act, which passed in late 2017.

7 Essential Rules for Claiming a Work From Home Tax Deduction

Thinking about claiming a home office deduction on your tax return? Follow these tips to avoid raising any eyebrows at the IRS.

1. You can’t claim it if you’re a regular employee, even if your company is requiring you to work from home due to COVID-19.

If you’re employed by a company and you work from home, you can’t deduct home office space from your taxes. This applies whether you’re a permanent remote worker or if your office is temporarily closed because of the pandemic. The rule of thumb is that if you’re a W-2 employee, you’re not eligible.

This wasn’t always the case, though. The Tax Cuts and Jobs Act suspended the deduction for miscellaneous unreimbursed employee business expenses, which allowed you to claim a home office if you worked from home for the convenience of your employer, provided that you itemized your tax deductions. The law nearly doubled the standard deduction. As a result, many people who once saved money by itemizing now have a lower tax bill when they take the standard deduction.

2. If you have a regular job but you also have self-employment income, you can qualify.

If you’re self-employed — whether you own a business or you’re a freelancer, gig worker or independent contractor — you probably can take the deduction, even if you’re also a full-time employee of a company you don’t own. It doesn’t matter if you work from home at that full-time job or work from an office, as long as you meet the other criteria that we’ll discuss shortly.

You’re only allowed to deduct the gross income you earn from self-employment, though. That means if you earned $1,000 from your side hustle plus a $50,000 salary from your regular job that you do remotely, $1,000 is the most you can deduct.

3. It needs to be a separate space that you use exclusively for business.

The IRS requires that you have a space that you use “exclusively and regularly” for business purposes. If you have an extra bedroom and you use it solely as your office space, you’re allowed to deduct the space — and that space alone. So if your house is 1,000 square feet and the home office is 200 square feet, you’re allowed to deduct 20% of your home expenses.

But if that home office also doubles as a guest bedroom, it wouldn’t qualify. Same goes for if you’re using that space to do your day job. The IRS takes the word “exclusively” pretty seriously here when it says you need to use the space exclusively for your business purposes.

To avoid running afoul of the rules, be cautious about what you keep in your home office. Photos, posters and other decorations are fine. But if you move your gaming console, exercise equipment or a TV into your office, that’s probably not. Even mixing professional books with personal books could technically cross the line.

4. You don’t need a separate room.

There needs to be a clear division between your home office space and your personal space. That doesn’t mean you have to have an entire room that you use as an office to take the deduction, though. Suppose you have a desk area in that extra bedroom. You can still claim a portion of the room as long as there’s a marker between your office space and the rest of the room.

Pro Tip

An easy way to separate your home office from your personal space, courtesy of TurboTax Intuit: Mark it with duct tape.

5. The space needs to be your principal place of business.

To deduct your home office, it needs to be your principal place of business. But that doesn’t mean you have to conduct all your business activities in the space. If you’re a handyman and you get paid to fix things at other people’s houses, but you handle the bulk of your paperwork, billing and phone calls in your home office, that’s allowed.

There are some exceptions if you operate a day care center or you store inventory. If either of these scenarios apply, check out the IRS rules.

6. Mortgage and rent aren’t the only expenses you can deduct. 

If you use 20% of your home as an office, you can deduct 20% of your mortgage or rent. But that’s not all you can deduct. You’re also allowed to deduct expenses like real estate taxes, homeowner insurance and utilities, though in this example, you’d only be allowed to deduct 20% of any of these expenses.

Be careful here, though. You can only deduct expenses for the part of the home you use for business purposes. So using the example above, if you pay someone to mow your lawn or you’re painting your kitchen, you don’t get to deduct 20% of the expenses.

You’ll also need to account for depreciation if you own the home. That can get complicated. Consider consulting with a tax professional in this situation. If you sell your home for a profit, you’ll owe capital gains taxes on the depreciation. Whenever you’re claiming deductions, it’s essential to keep good records so you can provide them to the IRS if necessary.

If you don’t want to deal with extensive record-keeping or deducting depreciation, the IRS offers a simplified option: You can take a deduction of $5 per square foot, up to a maximum of 300 square feet. This method will probably result in a smaller deduction, but it’s less complicated than the regular method.

7. Relax. You probably won’t get audited if you follow the rules.

The home office deduction has a notorious reputation as an audit trigger, but it’s mostly undeserved. Deducting your home office expenses is perfectly legal, provided that you follow the IRS guidelines. A more likely audit trigger: You deduct a huge amount of expenses relative to the income you report, regardless of whether they’re related to a home office.

It’s essential to be ready in case you are audited, though. Make sure you can provide a copy of your mortgage or lease, insurance policies, tax records, utility bills, etc., so you can prove your deductions were warranted. You’ll also want to take pictures and be prepared to provide a diagram of your setup to the IRS if necessary.

As always, consult with a tax adviser if you’re not sure whether the expense you’re deducting is allowable. It’s best to shell out a little extra money now to avoid the headache of an audit later.

The Penny Hoarder Shop is always stocked with great deals, including technology, subscriptions, courses, kitchenware and more. Check it out today!

Robin Hartill is a certified financial planner and a senior editor at The Penny Hoarder. She writes the Dear Penny personal finance advice column. Send your tricky money questions to [email protected].

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Source: thepennyhoarder.com

Get Car Insurance Starting At $22/Month With Smart Financial

If you haven’t checked car insurance rates in a few months, you could be overspending and not even know it.

And while it’s probably not something on the top of your to-do list, you should set a reminder to get a few quotes every six months. And if you do it through a website called SmartFinancial, you could be getting insider-level rates as low as $22 a month.

SmartFinancial is a digital marketplace for insurance. It has unique relationships with many of the top auto insurance providers, making it super easy for you to enter your information once and see all your quotes in front of you — making sure you get the best rate possible, without all the work.

See If You Can Save Up To $715 A Year On Car Insurance

When you fill out a one-minute form on Smart Financial’s website, you’ll be able to get quotes from multiple insurers, so you know you’ll get the best rate. If you want, you can speak to an agent to secure a low rate and finish the process in 10 minutes.

And don’t worry, your info is totally safe. Smart Financial has bank-level security and guarantees you won’t be spammed when you trust them with your phone number and email.

Rates start as low as $22 a month and can save you up to $715 a year — that’s some major cash back in your pocket. And if you bundle it with home insurance, you can save even more.

So if you haven’t checked car insurance rates in a while, you are doing yourself a disservice. Get started here to see how much money you can save today with a new policy.

Kari Faber is a staff writer at The Penny Hoarder.

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Source: thepennyhoarder.com

Term Life vs. Whole Life Insurance: Which Is Best for You?

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Advertiser Disclosure

Disclaimer

Taking out a life insurance policy is a great
way to protect your family’s financial future. A policy can also be a useful
financial planning tool. But life insurance is a notoriously tricky subject to
tackle.

One of the hardest challenges is deciding
whether term life or whole life insurance is a better fit for you.

Not sure what separates term life from whole
life in the first place? You’re not alone. Insurance industry jargon can be
thick, but we’re here to clear up the picture and make sure you have all the
information you need to make the best decision for you and your family.

Life Insurance = Financial
Protection for Your Family

Families have all sorts of expenses: mortgage payments, utility bills, school tuition, credit card payments and car loan payments, to name a few. If something were to happen and your household unexpectedly lost your income or your spouse’s income, your surviving family might have a difficult time meeting those costs. Funeral expenses and other final arrangements could further stress your family’s financial stability.

That’s where life insurance comes in. Essentially, a policy acts as a financial safety net for your family by providing a death benefit. Most forms of natural death are covered by life insurance, but many exceptions exist, so be sure to do your research. Death attributable to suicide, motor accidents while intoxicated and high-risk activity are often explicitly not covered by term or whole life policies.

If you die while covered by your life
insurance policy, your family receives a payout, either a lump sum or in
installments. This is money that’s often tax-free and can be used to meet
things like funeral costs, financial obligations and other personal expenses.
You get coverage in exchange for paying a monthly premium, which is often
decided by your age, health status and the amount of coverage you purchase.

Don’t
know how much to buy? A good rule of thumb is to multiply your yearly income by
10-15, and that’s the number you should target. Companies may have different
minimum and maximum amounts of coverage, but you can generally find a
customized policy that meets your coverage needs.

In addition to the base death benefit, you can enhance your coverage through optional riders. These are additions or modifications that can be made to your policy—whether term or whole life—often for a fee. Riders can do things like:

  • Add coverage for disability or deaths not commonly
    covered in base policies, like those due to public transportation accidents.
  • Waive future premiums if you cannot earn an income.
  • Accelerate your death benefit to pay for medical bills
    your family incurs while you’re still alive.

Other
riders may offer access to membership perks. For a fee, you might be able to
get discounts on goods and services, such as financial planning or health and
wellness clubs.

One
final note before we get into the differences between term and life: We’re just
covering individual insurance here. Group insurance is another avenue for
getting life insurance, wherein one policy covers a group of people. But that’s
a complex story for a different day.

Term Life Policies Are Flexible

The “term” in “term life” refers to
the period of time during which your life insurance policy is active. Often,
term life policies are available for 10, 20, 25 or 30 years. If you die during
the term covered, your family will be paid a death benefit and not be charged any future
premiums, as your policy is no longer active. So, if you were to die in year 10
of a 30-year policy, your family would not be on the hook for paying for the
other 20 years.

Typically, your insurance cannot be canceled
as long as you pay your premium. Of course, if you don’t make payments, your coverage will lapse, which typically
will end your policy. If you want to exit a policy you can cancel during an
introductory period. Generally speaking, nonpayment of premiums will not affect your credit score, as
your insurance provider is not a creditor. Given that, making payments on your
life policy won’t raise your credit score either.

The major downside of term life is that your
coverage ceases once the term expires. Ultimately, once your term expires, you need to reassess
your options for renewing, buying new coverage or upgrading. If you were to die
a month after your term expires, and you haven’t taken out a new policy, your
family won’t be covered. That’s why some people opt for another term policy to
cover changing needs. Others may choose to convert their term life into a
permanent life policy or go without coverage because the same financial
obligations—e.g., mortgage payments and college costs—no longer exist. This
might be the case in your retirement.

The Pros and Cons of Term Life

Even though term life insurance lasts for a
predetermined length of time, there are still advantages to taking out such a
policy:

  • Comparably lower cost: Term life is usually the more affordable type of life insurance, making it the easiest way to get budget-friendly protection for your family. A woman who’s 34 years old can buy $1 million in coverage through a 10-year term life policy for less than $50 a month, according to U.S. News and World Report. A man who’s 42 can purchase $1 million in coverage through a 30-year term for just over $126 a month.
  • Good choice for mid-term financial planning: Lots of families take out a term life policy to coincide with major financial responsibilities or until their children are financially independent. For example, if you have 20 years left on your mortgage, a term policy of the same length could provide extra financial protection for your family.
  • Upgrade if you want to: If you take out a term life policy, you’ll likely also get the option to convert to a permanent form of life insurance once the term ends if your needs change. Just remember to weigh your options, as your rates will increase the older you get. Buying another term life policy at 50 years old may not represent the same value as a whole life policy at 30.

There are some drawbacks to term life:

  • Coverage is temporary: The biggest downside to
    term life insurance is that policies are active for only so long. That means
    your family won’t be covered if something unexpected happens after your insurance
    expires.
  • Rising premiums: Premiums for term life
    policies are often fixed, meaning they stay constant over the duration of the
    policy. However, some
    policies may be structured in a way that seems less costly upfront but feature
    steadily increasing premiums as your term progresses.

Young Families Often Opt for Term Life

The rate you pay for term life insurance is
largely determined by your age and health. Factors outside your control may influence the rates you
see, like demand for life insurance. During a pandemic, you might be paying
more if you take a policy out amid an outbreak.

Most consumers seeking term life fall into
younger and healthier demographics, making term life rates among the most
affordable. This is because
such populations present less risk than a 70-year-old with multiple chronic
conditions. In the end, your rate depends on individual factors. So if
you’re looking for affordable protection for your family, term life might be
the best choice for you.

Term life is also a great option if you want a
policy that:

  • Grants you some flexibility for
    future planning, as you’re
    not locked into a lifetime policy.
  • Can replace your or your spouse’s
    income on a temporary basis.
  • Will cover your children until
    they are financially stable on their own.
  • Is active for the same length as
    certain financial responsibilities—e.g., a car loan or remaining years on a
    mortgage.

Whole Life Insurance Offers
Lifetime Coverage

Like with term life policies, whole life
policies award a death benefit when you pass. This benefit is decided by the
amount of coverage you purchase, but you can also add riders that accelerate
your benefit or expand coverage for covered types of death.

The biggest difference between term life and
whole life insurance is that the latter is a type of permanent life insurance.
Your policy has no expiration date. That means you and your family benefit from
a lifetime of protection without having to worry about an unexpected event
occurring after your term has ended.

The Pros and Cons of Whole Life

As if a lifetime of coverage wasn’t enough of
advantage, whole life insurance can also be a highly useful financial planning
tool:

  • Cash value: When you make a premium payment on
    your whole life policy, a portion of that goes toward an account that builds
    cash up over time. Your
    family gets this amount in addition to the death benefit when their claim is
    approved, or you can access it while living. You pay taxes only when the money
    is withdrawn, allowing for tax-deferred growth of cash value. You can
    often access it at any time, invest it, or take a loan out against it. However, be aware that anything
    you take out and don’t repay will eventually be subtracted from what your
    family receives in the end.
  • Dividend payments: Many life insurance
    companies offer whole life policyholders the opportunity to accrue dividends
    through a whole life policy. This works much like how stocks make dividend
    payments to shareholders from corporate profits. The amount you see through a dividend payment is
    determined by company earnings and your provider’s target payout ratio—which is
    the percentage of earnings paid to policyholders. Some life insurance
    companies will make an annual dividend payment to whole life policyholders that
    adds to their cash value.

Some potential downsides to consider include:

  • Higher cost: Whole life is more expensive than
    term life, largely because of the lifetime of coverage. This means monthly
    premiums that might not fit every household budget.
  • Interest rates on cash value loans: If you need emergency extra
    money, a cash value loan may be more appealing than a standard bank loan, as
    you don’t have to go through the typical application process. You can also get
    lower interest rates on cash value loans than you would with private loans or
    credit cards. Plus, you don’t have to pay the balance back, as you’re basically
    borrowing from your own stash. But if you don’t pay the loan back, it will be
    money lost to your family.

Whole Life Is Great for Estate Planning

Who stands to benefit most from a whole life
policy?

  • Young adults and families who can
    net big savings by buying a whole life policy earlier.
  • Older families looking to lock in
    coverage for life.
  • Those who want to use their policy
    as a tool for savings or estate planning.

To that last point, whole life policies are particularly advantageous in overall financial and estate planning compared to term life. Cash value is the biggest and clearest benefit, as it can allow you to build savings to access at any time and with little red tape.

Also,
you can gift a whole life policy to a grandchild, niece or nephew to help
provide for them. This works by you opening the policy and paying premiums for
a set number of years—like until the child turns 18. Upon that time, ownership
of the policy is transferred to them and they can access the cash value that’s
been built up over time.

If you’re looking for another low-touch way to leave a legacy, consider opening a high-yield savings account that doesn’t come with monthly premium payments, or a normal investment account.

What to Do Before You Buy a
Policy

Make sure you take the right steps to finding
the best policy for you. That means:

  • Researching different life insurance companies and their policies, cost and riders. (You can start by reading our review of Bestow.)
  • Balancing your current and long-term needs to best protect your family.
  • Buying the right amount of coverage.

If you’re interested in taking next steps, talk to your financial advisor about your specific financial situation and personal needs.

Infographic explaining the difference between term and whole life insurance policies.


Sign up now.

Source: credit.com