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My wife and I are expecting our first child so I’m looking into Life and Disability Insurance. I’d appreciate any feedback/advice on this.

I’m currently the primary breadwinner in our family and my wife is in grad school. I’m looking at a Term Life policy of 20 years. I’m assuming that should cover her and the child as between the policy amount and our current nest egg, 3-4% per year of the combined total would equal about 100% of our current cost of living.

The policy premium is about $160/mo. There’s an add-on of $50/mo that pays for the policy premium in the case of my disability and also, the Term policy would convert into a Whole Life policy should I become permanently disabled.

Assuming I keep the policy for 20years, I’m paying an additional $12K for this add-on. If I were to be disabled, I could use my Disability Insurance to cover the policy premium so what I’m really paying for is the conversion to Whole Life. I haven’t educated myself yet too much on Whole Life coverage, so not sure if it’s worthwhile.

Is this add-on worth it, or should I just go with the base policy?


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