[quote=HLS]Hi Ray,, interesting strategy but I think that laddering life insurance is pretty risky in itself as you may not qualify for a policy 10 years down the road at all so it also depends on if you want to gamble with coverage, and it’s more expensive to buy the older you get.
Premiums are likely to rise in the future as well.
20 years of coverage starting today may not cost much more than 10 years of coverage starting in 10 years.
Perhaps it also depends on whether you plan on winning or losing the bet with the life insurance company.
If you win, the return on a policy is far better than money in a retirement account. If you lose the insurance company gets to keep your money but you are still around to talk about how much you wasted.
The only reason term policies lapse is because people stop paying the premiums.
Is the goal to allow the survivor to live a similar lifestyle or force them to scale down as suggested above ?[/quote]
Alternatively, you can buy more than one policy, each being smaller amounts, versus 1 large policy. Total upfront premium costs for all policies would be more than a single larger policy, BUT then you can cancel one of your policies as your financial position changes. So for instance rather than buy 1 $1million, buy two $500k, and cancel one if you have built up $500k in reserves. Also insures yourself against an insurer if they go belly up (although unlikely)
