[USER]

Hi guys, I am new here. I am making approximately around $48k a year I am paying for my whole life insurance, $147 a month,and for my son whole life insurance $50 a month, I am so naive about investing, do you think paying for whole life insurance is a good idea?

My financial advisor told me, that when I get old I am able to get move off. I am 36 years old, I am paying for my roth IRA, that my financial adviser get some 2% of that, should I continue to pay for that too?

[Ben]

Everyone’s so fixated on the fees. The real issue is that you’re spending money on whole life!

[Ben]

Um you have been con into buying whole life insurance.

I would get rid of the financial advisor as fast as possible.

[David]

I might want to find another financial advisor, 2% is too high to be paying in fees.

[Don]

You have an insurance salesperson NOT a financial advisor.

Get yourself TERM life insurance and if your work provides it get your child a policy through there.

Save 3-6 months of emergency fund (this could cover your childs burial if needed) Then invest the other $117 (cause your TERM policy will probably be $30ish a month) into a Roth IRA.

Also, check out: What kind of questions should we ask the agent when shopping for term life insurance, other than the obvious cost, amount, and term?

[Sunny]

Also, not really necessary to buy life insurance for your child.

Take that monthly $50 and invest in index fund instead should you need it for funeral costs.

[William]

I’m a financial advisor and the highest fee I have ever heard of is 1.7% pa….until now.

[Roy]

Your pseudo financial advisor surely is getting a whole lot of commission money from poor, self serving and inappropriate investment advice. Just get a term life insurance only for yourself, cancel whole life insurance for your son, by doing so you will have more money left to maximize your 401k contribution at least up to a point of employer match.

Then, as you get more available funds for investment you can open Roth IRA. Your annual income of 48k makes you eligible for Roth IRA. Whole life insurance/ and or annuity should not be the first choice of investment that any good honest financial advisor is talking especially at your income level.

If you really want a good financial advise that will work for you, find a fee only fiduciary financial advisor that will make a financial plan based on your risk tolerance, life situation and your specific financial goals. Avoid free financial advise and those advise that will give you free dinner.

Nothing is free.

For sure they will sell you high commission, high fee investment with poor ROI.

Don’t forget to take a look at: Life insurance question

[Matt]

Dump the financial advisor and the whole life insurance. Assuming you are in good health, get term life for yourself, I would not* worry about getting life insurance for the kid.

You don’t need to pay for a financial advisor, you can buy index funds or a target date fund in your IRA. FXAIX, VTSAX are good examples.

[Santiago]

Get rid of the “advisor” who is dragging you through the mud! Whole life is not a good thing for you but only an expensive drag.

Same as the commission you are gifting this person with.

Buy Index funds instead.

[Brandon]

Switch to term life insurance and start a Roth IRA through Fidelity.

Dump all your roth money in FZROX.

Tell the financial planner to hit the road.

[Rob]

You’re losing 2% right of the top – that’s terrible! Add on the more then likely high expense ratio funds he more than likely has you in and you’re forever behind the 8 ball.

Educate yourself and move on from your “advisor”.

Your older self will thank you.

Would you also like to explore: I applied for life insurance and was asked a question. What is your net worth?

[Nicholas]

Most whole life insurance has insane fees. Run from that as fast as possible and get a simple and cheap term policy. Why do you need a policy for your son?

I suspect he is quite young and not in need of such a policy.

Insurance companies tend to talk young families into buying policies for their young children when those are not needed.

[Jule]

Wow! Please run away from this salesman. I mean “financial advisor.” He’s looking out fue his numbers, not yours. Sold you a terrible product and on top charging your a high fee.

A kid doesn’t need life insurance. You do as you are his support. Cash out it out and get a term life insurance for $30/month.

You don’t need to manage an IRA, just find an asset allocation and forget it.

Read The Simple Path to Wealth book. It essentially says to use a Vanguard fund like VTSAX or Fidelity FZROX, which just trabo the stock market. That’s it. You will be saving this anda of dollars a year from predators like that FA.

I have a couple of million dollars invested and we don’t need a financial advisor. I do it myself by reading and learning. Stick with this board and educate yourself instead of trusting someone who’s more after their own gains.

You can check also: Life Insurance question: Should I be shopping around for rates? If you used Zander who did you end up with? Do they do medical exam?

[Sean]

This “advisor” is a glorified scam artist. Fire him yesterday.

Find a fee only certified financial planner and get all of this sorted out.

[Author]

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