Why I Have Mixed Feelings About Getting Life Insurance

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  • When my father died and I received his life insurance, it took me a long time to accept that the money was mine.
  • I ended up using it to buy myself an apartment in NYC, which I later sold at a profit.
  • I have since built wealth through real estate, but still can’t bring myself to buy my own life insurance.

When my father died about 30 years ago, my sister and I received a large life insurance payout. My sister was still a minor, so my mother oversaw that she invest the money with a financial advisor, but I was 19 when he died, which meant I was legally an adult. I was on my own with how to manage it.

It was so overwhelming, and I kept it in cash for several years, along with money I inherited outright. It was unfortunate, and it took me ages to find a financial advisor.

I used the money to buy property across the US

The first real thing I did with the money was buy an apartment in New York after I graduated from college. It made sense to me: I needed somewhere to live, and the funds were just sitting there. For $500,000 (which felt very expensive at the time) I got a nice two-bedroom in the West Village, with a view of the Empire State Building.

The moment I signed the papers to buy it, my next call was to 1-800-Mattres (“Leave the last S for savings!”) and had a bed delivered to the apartment so I could be there that night sleep. I was a 23-year-old with an apartment in New York and I appreciated my father and the money he left me to make this happen.

Four years later I moved to California and sold the NYC apartment for almost double what I paid for it. Of course it was very satisfying. I continued to buy and sell residential properties in Los Angeles; Vancouver, Canada; and Naples, Florida, before returning to New York and settling here.

My record with real estate has not been perfect: I got caught up in the 2008 housing bubble in Florida and I saw my property value drop dramatically on my primary residence. Ah! But overall, real estate was a good way to invest the proceeds of my father’s life insurance policy and inheritance. Real estate was an investment I understood, and even when the real estate dropped in value, I still had somewhere to live, so it didn’t really feel like it mattered.

I still couldn’t bring myself to buy my own life insurance

Today I am a parent myself. I have two wonderful children who surprise and delight me daily with their brilliance. Now that I’m a mom, I know I should probably get a life insurance policy of my own.

I have a friend whose mother was very thoughtful about purchasing life insurance and got a large enough policy so that if, God forbid, something happened to her while my friend was still in school, college would still be paid for. My friend remembers her mother gratefully lowering the policy (and the premium cost that came with it) once my friend had successfully completed her schooling. It just makes so much sense.

And yet, I still haven’t brought myself to do it. Even though I see the benefits of that policy in my life, the experience is still wrapped in the pain of my father’s death. I got a lot of money because someone I love died. It just feels…off. It took a lot of emotional work and therapy (which I certainly paid for using some of the proceeds) to help me accept that the money was mine to do with as I saw fit.

I think I could use more therapy to help me do the right thing for my kids…

I’m probably afraid that planning for my early death might bring that about. My family has recently been through a tragedy and I just don’t want to think about the possibility of more trauma.

Sometimes people put off writing their will because it means confronting their own mortality. I know I resisted it until recently. But I learned something interesting from a trust and estate attorney: Some cultures believe that when you write your will, it’s a sign of longevity. I know I felt a rush of relief when I finally completed a new will in 2020 after putting it off for a few years.

So maybe life insurance will be the same. For now, my “insurance policy” is aimed at taking excellent care of my body, mind and finances. I have structured things in such a way that if something does happen to me, my children’s education and lifestyle will be in order. But maybe just writing this will help me shift my hesitation to add a policy to the mix.

Life insurance was a moving gift from my father. I think I used it well. I’m not yet ready to make that kind of gift a possibility for my own children, but I’m open to change.

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