Money Management Newsletter: Insurance
Is Mortgage Life Insurance worth it?
How often do we review our monthly expenses -
$40 for cable, $87 to the phone company - you get the picture - lots of
small items to pay and the bank charging on each transaction to boot!
One just payment is the mortgage life insurance premium,
that sometimes is hiding besides your Mortgage payment.
As you know, mortgage life insurance pays off your mortgage
in the event you die, and may cost up to $50 a month per $100,000 of mortgage
principal. After 15 years, you've paid regular monthly insurance premiums
and your mortgage may be down to $25,000. That monthly premium now will
generate a relatively small payout to your heirs, plus you've lost the
opportunity to invest that premium money.
You may be better off buying a term life insurance policy
for $100,000 and your heirs will receive the full amount, not just the
mortgage balance. Or, make monthly extra mortgage payments with your money
and save on mortgage interest.
Ask lots of questions, compare the costs of insurance
products, and calculate how much mortgage interest you would save in order
to make the best choice.
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© , Fiscal Agents Money Management Newsletter
25 Lakeshore Road, Oakville, On L6K 1C6.