Gerber Life Insurance: Is it Worth the Money? (2012 Edition)

One of the most popular posts here at CFO is my analysis of Gerber Life Insurance. Since it's over four years old, I thought it was time to revisit the issue and ask again: Is Gerber Life Insurance worth the cost?

A few months ago, I discussed when you need (and don't need) life insurance. The simple answer was that you should buy life insurance if the death of the insured would cause a financial hardship. Usually, that means a breadwinner or caregiver - for example, if Dad is the main source of income and his death would leave the family without enough money to get by, then a life insurance policy for Dad would be a great idea.

But the death of a child, as tragic an event as it is, doesn't normally present this type of financial hardship. That's why I scoffed at Gerber Life Insurance before my children were born - it seemed designed for suckers.

However, Gerber's Grow-Up Plan is a whole life policy. Whole life insurance is a little more complicated than term insurance, which only pays out if you die within a specified period of time. With whole life insurance, the policy isn't for a set period but rather for the rest of your life. Partly because of that, the premium is considerably higher than the premium for a term policy. And, unlike with term insurance, part of the premium of a whole life insurance policy goes toward an investment component. Generally, the return on the investment portion of a whole life policy is such that it’s not considered a good investment, i.e., you could get a better return on your money elsewhere.

So I look at the Grow-Up Plan not so much for the life insurance component, but as an investment option. Premiums are determined by your child's age, gender, and state of residence, and are guaranteed to remain the same. Coverage is automatically doubled when the child turns 18. The policy's cash value will be at least equal to or greater than 100% of the premiums paid after 25 years. As an adult, the originally-insured child is guaranteed the right to purchase up to 10 times the original coverage amount, regardless of health, occupation, and other factors that may render him or her ineligible with other companies.

For my 7-year-old, a $50,000 policy would cost $37.40 per month, or $448.80 annually. Paying $448.80 each year for the next 25 years is a total expense of $11,220. If I took at that $37.40 per month and invested it in a mutual fund that earned a conservative 3% for 25 years, I would have $16,857.90 - that's an increase of $5,637.90. If the mutual fund grew at 5%, my total would be $22,796.52. So if I put the money toward the Grow-Up Plan, in 25 years, I'd have cash value of $11,220 (and possibly more), but if I invested the money in a mutual fund, I'd probably have quite a bit more. The tradeoff is that I wouldn't have the insurance payout.

Since the coverage doubles but the premium remains the same at age 18, I wondered what would happen if you bought the policy at age 14 (the last year a child is eligible for the Grow-Up plan). The premium on a $50,000 policy for a 14-year-old boy in California would be $47.48 per month, or $573.36 per year. Right now, I'm seeing annual premium quotes for $100,000 whole life polices for 18-year-old males in California for as low as $342. So the $100,000 whole life policy itself doesn't seem like a good deal.

My non-expert conclusion is that if you think your child is unlikely to be eligible for life insurance when he or she is older, the Grow-Up Plan is an option you may want to consider now. But it seems like everyone else would be better off investing the money elsewhere - say, tax-advantaged vehicles like 529 plans, Coverdell Educational Savings Accounts, or even your Roth IRA.

Disclosure: This post has no association with Gerber, although the link to the Gerber Grow-Up Plan is monetized via Viglink. I am not an expert on insurance; consider this post food for thought and consult a real expert for in-depth questions. Read the full CFO disclaimer and disclosure policy here.

Image via FreeDigitalPhotos.net by TCJ2020.

My Key to Getting Things Done: One Project Per Day

You might have noticed that my week-in-review posts have tapered off, and that's because I've been working hard to come up with a better time-management system based on The Rule of Three.

In a nutshell, I realized that I would greatly increase my productivity by limiting my focus to just a few things at a time. So I came up with the idea of focusing on one project/goal each day. Of course, some things need to be done every day, like exercise and cooking. But, here's what I'm planning on trying over the next few weeks:

Monday - Shopping & Batch/Freezer Cooking

Tuesday - Blogging

Wednesday - One or two of the following: Shopping, Batch/Freezer Cooking, Cleaning, Home Organization

Thursday - Blogging

Friday - Cleaning (I do my Weekly Home Blessing Hour on Fridays, so it makes sense to focus on cleaning the whole day)

I started following this plan last week and I felt like I got more things done. So hopefully that trend will continue as I get better at implementing it!


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Menu Plan Monday: Week of 2/27/2012

I can't believe it's March 1 on Thursday, except that Trader Joe's hasn't had winter squash for a few weeks now. I did notice that they have whole heads of cauliflower for $1.69 each, which is a great price considering they're $2 at the farmer's market.

As I continue working out a time management system, I will hopefully figure out a way to be more efficient in the kitchen. In the meantime, though, here's what I'm planning for dinner this week:

Monday - Chicken Enchiladas, Salad

Tuesday - Tuna Pasta Salad (I didn't get to it last week) with Oven-Dried Tomatoes from Ad Hoc at Home

Wednesday - Shoyu Chicken (chicken thighs braised with soy sauce & other seasonings), rice, some kind of vegetable

Thursday - Mac & Cheese (I bought some double cream Gouda and Parmesan-Gouda cheeses at Trader Joe's this week), Sauteed Green Beans

Friday - Yaki-udon (stir-fried udon noodles) with vegetables

Saturday - Leftovers

Sunday - Dinner out

See more weekly menus at I'm an Organizing Junkie.

California Car Seat Laws

As of January 1, 2012, California's child safety seat laws changed to require that all children under the age of 8 be secured in a car seat or booster seat in the back seat. Additionally, children under the age of 8 who are 4 fee 9 inches or taller must sit in the back seat, though they may be secured by a safety belt.

The new law was enacted because the risk of injury to a child is reduced by 33% in the back seat as compared to the front seat. There are a few exemptions to the new law, so a child may ride in the front seat if:

• The vehicle has no rear seats.


• The rear seats are side-facing jump seats. (Child safety restraints must never be placed on side-facing vehicle seats.)


• The child restraint system cannot be properly installed in the rear seat.


• Children under age 12 occupy all rear seats.


• A valid medical reason as written by the child's pediatrician.

The CHP web site has an FAQ with some sample scenarios, such as when all belts in the back seat are lap belts.

You can sign up for car seat recall notifications from the NHTSA here.

Declutter Tip: File papers as they come in

About a month ago, one of my weekly projects was to file the stack of papers that had built up on my desk over the course of several months. It took less than an hour, but it was tedious.

Ever since then, I've been filing papers as they've come in. Which means that I don't have a month's worth of papers to file right now, and that feels like a gift to myself. It helps that we've cleared away some clutter so it's easier than ever to access the filing cabinet.

It only takes a few seconds to file each sheet of paper as it crosses my desk. It takes nearly the same amount of effort to add the paper to my filing box, but this keeps the paper clutter from accumulating.

The one exception I make to this rule is papers that don't have a home. There are a few files I need to create, but I'm not quite sure how I want to organize them yet, and some papers I just need to keep for a short time and then can toss. So those pages have been added to my filing box but the pile is so much smaller than what it used to be!

The Military's "Rule of Three"

A couple of weeks ago, I was reading this article in Good Housekeeping, and was struck by the concept of the "Rule of Three," which is used by the U.S. military:

They've found that people can only track three things at once. The entire military system is designed to reflect this. A squad leader is in charge of three fire team leaders...." (When the military experimented with a "Rule of Four," notes Seelig, effectiveness dropped precipitously.)

I know this section got my attention because I've been struggling to accomplish all of my goals in multiple areas - housekeeping, cooking, blogging, health and fitness, home organization (which is distinct from housekeeping), financial goals, plus smaller projects like things I've taken on for the PTA. That doesn't even touch on the goals I'd like to add to my list, like educating myself more about investments.

The concept of the Rule of Three made me feel better about my struggles. It makes sense that I'm having a tough time because I'm trying to do too much, which makes it difficult to be effective at anything.

I feel like I need to combine the lessons of Eat That Frog! with the Rule of Three to maximize my productivity and minimize stress. (Because nothing creates stress like feeling overwhelmed!)

So . . . I'm working on these things right now:

Clarifying my goals per Eat that Frog. The clearer my goals, the clearer the things that need to be done in order to achieve them.

Working out a system to implement the Rule of Three. I don't want to reduce the number of things I want to accomplish, but I can focus on a few at a time, which will hopefully have the same effect as following the Rule of Three.

I am also hoping this book, Getting Results the Agile Way: A Personal Results System for Work and Life, will be a Kindle deal soon because it apparently discusses the Rule of Three in relation to productivity.

Menu Plan Monday: Week of 2/20/2012

I'm hoping for an easy week of cooking this week, as I try some new organizational methods out around here (I'll share more about those later in the week). Here's what I'm planning for dinner while all this is going on:

Monday - Meatloaf, Salad, Biscuits

Tuesday - Tuna Pasta Salad

Wednesday - Roast Chicken, Garlic Sauce, Flatbread, Sauteed Green Beans

Thursday - Taco Cornbread Pizza

Friday - Breakfast (pancakes, bacon, eggs), Fruit

Saturday - Leftovers

Sunday - Dinner out

See more weekly menus at I'm an Organizing Junkie.

Coping with the "Blahs"

I had something of a rough night last night with one of the kids, and in general, just haven't had the energy and enthusiasm I usually enjoy for the last few days. When I get this way, I find there are a few things that help get me out of my funk:

Exercise - It's usually the last thing I want to do, but getting the blood flowing usually helps me feel better faster than anything else.

Do something I enjoy - Whether it's reading a book, watching a favorite TV show, or cooking, it's hard to feel down when I'm doing something I truly enjoy.

Hang out with friends - My girlfriends are an important part of my well-being, and they give me perspective. Plus, it's just nice to spend time with people who like you and choose to spend time with you.

Do nothing - Sometimes the best course of action is to do nothing and just let these feelings run their course. One of my favorite writers, Madeleine L'Engle, noted more than once that you need the lows in life in order to enjoy the highs - it's the contrast that gives the highs meaning, and without the contrast, everything is the same.

What do you do to get rid of the "blahs"?

Money-making Tip: Update your listings if you sell on Amazon

I've written before about selling on Amazon, and how it's my favorite way to sell used items like books, video games, and DVDs. Not everything is worth listing, but one thing that's great about Amazon is that it's pretty much a "list and forget it" kind of thing. If an item sells, Amazon will send you an email, but unless and until that happens, you don't really need to think about it.

However . . . I'd noticed that it had been a long time since I'd sold anything at Amazon. So a couple of weeks ago, I went through the two grocery bags where I kept the items listed for sale at Amazon and checked the listings. Many of the items were no longer worth selling - there were too many similar items, so the price had dropped considerably since I'd created my listing. I deleted those listings and moved the items to my pile of things to donate.

For most of the remaining items, I had to drop the price to bring it in line with other sellers' prices that had been posted since I'd last checked. I also updated a couple of listings with more detail about the condition of the item.

The effort has paid off. In the couple of weeks since the update, I've sold half a dozen items and keep having to go to the post office - adding about $50 to my savings account in the meantime.

If you're interested in learning about selling on Amazon, check out my previous series on selling at Amazon, and these updates.

Menu Plan Monday: Week of 2/13/2012

Monday - Takikomi gohan {rice cooked with ingredients such as mushrooms, like in this recipe}, some kind of fish, simmered daikon {Japanese radish}

Tuesday - Prosciutto-wrapped Asparagus, Filet Mignon, Creamed Spinach, Cinnamon & Orange Creme Brulee {I saw Anne Burell making this yesterday on her show and thought my husband would like it, plus I have a propane torch now from cooking prime rib during the holidays - he he}

Wednesday - Bolognese Ravioli {it's a new product from Trader Joe's - I was intrigued}, salad, Artisan bread

Thursday - Miso Chicken, rice, salad or roasted vegetable

Friday - Breakfast (pancakes, sausage, eggs)

Saturday - Leftovers

Sunday - Dinner out

See more weekly menus at I'm an Organizing Junkie.

Contemplating All-Cash Spending Experiment v.2

A lot of people claim that you spend less when you only use cash, including bloggers I admire like Crystal of Money Saving Mom. Four years ago, my husband and I attempted the shortest-lived all-cash experiment ever, and I gave up on an all-cash system for us. After all, we do just fine without it - we are still very conscientious about our spending, save money every month, and maximize our credit card rewards.

But yesterday, Josie at Southern Cali Saver wrote about how the envelope system works for her. With the envelope system, each envelope holds the cash for a category in your budget.

It got me thinking about trying a modified "some-cash" spending experiment - maybe just for the categories where I could use a little more discipline, like the groceries and stockpiling. I tend to just grab the good deals when I see them, without worrying about whether I'm overspending for the month (on the theory that it all evens out). But maybe if I were more conscious of exactly how much I'm spending, I could save enough money to make the effort worthwhile.

I'm going to have to put some thought into this - I don't really know which categories I would switch to cash, and it's been so long since I've had a formal budget that I'm not sure how much to budget pet category. But it's definitely something I'm going to think about and revisit in the next few weeks.

Week in Review: 2012 Week 5

Here's an update on how things went with my resolutions last week:

In a word, blah.

I did okay with some stuff, not so much with others. Part of it is that these types of things are cyclical, especially the motivation. As long as I don't deviate too far from the trail I want to be on, I feel okay about things.

But after straying off a little bit, it's important to get back on track.

My healthy habit for February is to continue January's habit and add 10 minutes of stretching each day. It sounds simple but I've already missed three days' worth of stretching. I'll get back to that this week. At least I kept up with my extra daily mile from January.

My weekly project for last week was to clean the stove, which didn't get done. However, I did declutter two boxes of stuff, so I'm counting that a success since both boxes were going to be part of a future weekly project. However, it goes without saying that my stove didn't magically clean itself so that's my project for this week.

Finally, the housecleaning is going okay but not great. Again, this is about making housecleaning a habit, and something I am going to keep working on this year. I feel like I have some catching up to do now, and that's something I want to get out of the habit of.

Here's to a productive week for all of us!

Menu Plan Monday: 2/6/2012

I actually followed my menu plan last week, and feel we ate quite well, so that makes me more motivated to do this week's menu plan. Here's what's on tap:

Monday - Cheesy Chicken Enchiladas {although I'll substitute my own "cream of" sauce instead of using canned soup}, Salad

Tuesday - Breakfast (Pancakes or Waffles, Eggs, Bacon, Fruit)

Wednesday - Tuna Pasta Salad

Thursday - Meatball Heroes, Sweet Potato Fries

Friday - Ramen with vegetables

Saturday - Leftovers

Sunday - Dinner out

See more weekly menus at I'm an Organizing Junkie.

2012 Resolutions in Review: January

I set some very doable goals for 2012, and I'm finding it immensely helpful to go over my progress each week. I hope that as I learn to be more productive, I can share some tips with you along the way.

January was a very interesting month, because I've always set goals and worked to achieve them, but I'm learning more about what really works for me. I bought the Kindle edition of Eat That Frog!: 21 Great Ways to Stop Procrastinating and Get More Done in Less Time when it was just $0.99 a few weeks ago, and I'm finding it immensely helpful in keeping me focused and on track. The two biggest keys I picked up and have tried to keep at the forefront of my mind in the last month are having a clear vision of my final goal, and doing the tasks with the greatest impact first.

One of my resolutions this year is to develop a new healthy habit each month. In January, I achieved my goal of adding a mile to every day to develop the healthy habit of exercise. I learned that it doesn't take a lot of time (less than 20 minutes!), and I can make the time if it's a priority. I don't feel like it's an ingrained habit, though, so I'm continuing it into this month.

But I'm also adding a new healthy habit in February, which is a mere 10 minutes of stretching each day. It's good for my foot, as I'm still struggling with plantar fasciitis (it's been over a year and a half and my doctor, who's had it himself, wasn't surprised). I'm also feeling tension in my shoulders and back, so stretching should make me feel better overall.

Another resolution in 2012 is to do one project per week. My weekly projects are going well - last week, I sorted and organized a couple of small areas that I hadn't gone through in a while. My project for this week is to clean my stove, since it really needs it. But I've also done and will do a few other smaller projects around the house as well.

Finally, it's not exactly a resolution, but I implemented a new housecleaning plan this year by doing one cleaning task each day. It's a habit I'm still developing, and I get my daily task done most days. I'm quite satisfied with how things are going in that area.

I'm looking forward to achieving more in February, but I think I need a much clearer picture of exactly where I want to be at the end of year, so I can get the most out of the months to come.