A family friend convinced me that bank on yourself via a whole life insurance plan was the best thing for my retirement. After paying in for 3+ years, my wife and I have just over $50k in cash value. The returns have been absolutely abysmal: we’ve invested a total of nearly $90k. Supposedly at year 7 years of investment we break even. Maybe that will happen, maybe not. If I cut my losses and cash the whole thing out, where should I put that money? Since I’m stupid I haven’t invested much my 401k. It’s sitting pretty at $2k. I’m thinking the first thing I should do is max that out for the year. Our only debt is a $90k mortgage at 3.8%. Should I make a huge payment on the house? I’m obviously financially illiterate so any help you all can provide would be massively helpful. I hope this post serves as a guide to others. Also, I don't care about the life insurance aspect. -- Edit I'm 31 years old. -- Edit I've put together a few graphs to help show the financial situation of the accounts. Paid Premiums vs Cash Value - http://imgur.com/a/BGvys Cash Value Less Paid Premiums - http://imgur.com/3u6L3MZ Cash Value as a Percent of Paid Premiums - http://imgur.com/8s3gMQG Percent of Contribution Applied to Cash Value - http://imgur.com/MMRiHKK -- Edit The company I'm working with is Northwestern Mutual -- Edit The combined values of the policies is $2.7M -- Edit One redditor suggested calculating continued investment in the life insurance plan vs taking the loss and investing the cash value in an index fund. The assumption of the life insurance fund is that it “breaks even” at 7 years (4 years from now). At the current investment level, the final value would equal $185K. Surrendering the account today would leave me with $51K. If the cash was used to invest in a 5% index fund while maintaining identical additions, the total equals $162K. At 7% 171K. At 10% $187K.