General life experience does not really equip us to know whether life insurance premiums are a good deal. (No disrespect to the Ford Fiesta, my family had one growing up, perfectly pleasant car - but definitely not a $40k one!) General life experience in the USA conditions us to know that $80k – or even $40k – for a Ford Fiesta is ridiculous. Same idea with Gerber – doubling what you get at "no extra charge" is still a bad deal. Selling you two Ford Fiestas for $80k is still really, really wrong. The truth is: Selling you a Ford Fiesta for $80k would be wrong. Gerber says: “Coverage doubles at age 18 at no extra charge” 3) Gerber life insurance is really, really expensive insurance (part I) You might wonder, does it get much better over time, when she’s much older? No, it does not:Īfter nearly 65 years of diligent savings, Gerber cash value would offer a tiny 1.7% annual return, unlikely to even keep up with inflation. We saw above that my daughter would get back less than I paid in even after nearly 4 decades of diligently saving money. Sadly, that opportunity is wasted with a Gerber Grow-Up Plan. Any child lucky enough to have a parent or grandparent ready to set aside money on their behalf has a tremendous opportunity: to enjoy the benefits of compound interest over a very long time. Warren Buffett rightly sings the praises of compound interest. The truth is: there are many, much better ways to give your child a head start financially Gerber says: “Give your child a head start” 2) Children and their families miss out on so much with a Gerber Grow-Up Plan Pennies in a change jar would actually be a better investment than the Gerber Grow-Up Plan, at least for the first four decades. Gerber’s customer testimonials show a mom saying, “you put pennies in a change jar, put ‘em in a policy!” My heart breaks when I hear this. I could literally put cash in a mattress and come out with a better return (zero) – after nearly 4 decades of diligent savings – than with the Gerber Grow-Up Plan. The green bar is how much I’d pay in premiums, the red bar is what we’d get back if we wanted them money for – as Gerber likes to advertise – “college textbooks” or a “down payment on a car”. The truth is: Gerber’s guaranteed cash values would lock my daughter and me into a loss for nearly 40 years. I’m going to lay it out here, so you have the benefit of this information: 1) Gerber Grow-Up Plan cash value is a terrible investment What I found was so much worse than I ever imagined. (There’s a 30 day free look period in New York state.) I even took out a policy on my own 1 year old daughter, to see up close how it works. How could this trusted brand sell such an awful product? The more I learned, the angrier I became. People kept asking me what I thought of Gerber Life Child Life Insurance, aka the Gerber Grow-Up plan.
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