#3 Posted: 9/25/2012 11:23:33 PM
First, I dont like insurance on kids as a means of investment. Instead just put aside some money earmarked in an account, or look into Educational IRA accounts..I think whole life insurance on a kiddo is a terrible idea and you should consider undoing that policy.
I also dont like whole life policies or Annuities in general but specifically in this market environment..most Annuities are made to guarantee a rate of return from a fixed income perspective or have market clauses which are meant to sort of participate in the S&P or the DOW, whatever and have an insurance benefit too. If you were to buy term insurance and use the difference of premiums towards the index it is aiming to mirror then you should be able to easily beat the returns they are promising. The only redeeming benefit to annuities are if they have a no-loss provision where you cant lose the cash value ammt irregardless if the market tanks or not.
At 34 I would rather max the SEP account, max any Roth or IRA option, set aside regular investments earmarked for the kiddo and avoid the packaged garbage you get sold by likely your insurance agent..
The most important thing you can do is max out your SEP IRA..that is the first priority. |