My wife has had an insurance policy since 1994 and we are unsure if we should continue paying premiums or cash it in. We are a two physician couple and both have term life policies (1 mil, 1.5 mil... slightly low I know but we figure that the other spouse will continue to work if one of us dies) with one child and a mortgage slightly less than our annual salary in a medium COL area.
I looked in to the details of the policy and I can't tell if it's whole life or variable universal life. It's an Axa IncentiveLife policy that was started in 1994 and has had premiums paid since then. My wife's parents were paying the premiums up until 6 years ago when we took over payment.
If the premiums were very expensive, we'd probably stop paying them, but it's only $164 a year. The face amount of $100,000, current death benefit is $127,480, net cash surrender value $27,480, and the total premium payment amount to date is $14,028.
Should we keep paying the premiums or cash it in? We don't really need to death benefit given her term policy of 1.5 mil. What would the tax hit be if we cashed it in?
I looked in to the details of the policy and I can't tell if it's whole life or variable universal life. It's an Axa IncentiveLife policy that was started in 1994 and has had premiums paid since then. My wife's parents were paying the premiums up until 6 years ago when we took over payment.
If the premiums were very expensive, we'd probably stop paying them, but it's only $164 a year. The face amount of $100,000, current death benefit is $127,480, net cash surrender value $27,480, and the total premium payment amount to date is $14,028.
Should we keep paying the premiums or cash it in? We don't really need to death benefit given her term policy of 1.5 mil. What would the tax hit be if we cashed it in?
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