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Author: draknor One star, 50 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76237  
Subject: Re: Whole Life Help/Question Date: 3/12/2008 10:52 PM
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2.) Would this be a good route to go, despite the fact that I won't need insurance for at least 5 years (if ever) given my basic financial situation (I know I didn't provide all the details)?


There's a saying I've heard on these boards -- don't let the tax tail wag the investment dog! That is, just because something may have tax advantages, doesn't mean its a better investment than a taxable one.

I don't know anything about whole life insurance, but for someone in your position (fairly similar to mine, actually), I'd recommend increasing your investments in either the 401(k), a Roth 401(k) (if offered by your employer), or put the money into a taxable brokerage account (since you are already maxing your Roth IRA).

As someone else posted, long-term capital gains & qualified dividends are pretty tax efficient (15%, currently), so building up a nice long-term, dividend-paying portfolio will give you great income in the long-term, especially if you reinvest dividends now (when you don't need the income).
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