Reader question:

How do you for the cost of universal life insurance?

Maggie

Excellent question, Maggie.

One thing that is really confusing about the cost of universal life insurance is that there are a bunch of different ways to pay, and they have their own relations to the policy. Here are a couple that I have figured out.

• One Premium.

The cost of universal life insurance with one premium is paid all at once, and it keeps ou covered so long as cost of insurance charges have not taken all of the money out of your account–which takes awhile. This is treated a special way by taxes.

• Flat premium.

This is a typical way for paying for the cost of universal life insurance. You make monthly payments for a few years, and then you are done paying. However, at the end, your insurance might not be worth as much, so you can leave it and get another policy.

take care,

Fashun.