Jacksonville Florida FL Life Insurance
Reader’s Question:
Can I use my whole life insurance for payment of debts?
Reena
Jacksonville, FL
Hello Reena,
Your whole life insurance has a savings account feature. So this means you are also investing on accumulated money which you can use for whatever purposes in the future. To answer you straight: yes you can actually withdraw or borrow the investment side of your life insurance and pay your debts. However, you should take considerable note that you can only do this if your cash value has grown considerably. Meaning if your cash value exceeds the total amount of premium you paid.
Usually, the whole life insurance starts to exceed ist value from your premiums paid starting 12th or 15th year. If you reach this period already and the accumulated cash is enough for you to borrow, then you can use the borrowed amount for whatever purpose you have including paying current debts. But if not, you should not fall below the minimum amount of cash value otherwise your life insurance will lapse.
Just like any borrowed amount, you have to return it. You need to talk to your life insurance agent in Jacksonville FL how much money you should pay to cope up with your borrowed amount. If you will not return the borrowed amount, you may have difficulty increasing the investment side of life insurance. Again, the best thing to do is talk to your life insurance agent for the best solution and options.
Tags: debt settlement, life insurance policy, whole life insurance