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Message
re: Indexed Universal Life policy. Who has done it?
Posted on 7/27/23 at 2:40 pm to buckeye_vol
Posted on 7/27/23 at 2:40 pm to buckeye_vol
give me some cons!
3
Posted on 7/27/23 at 4:33 pm to HailToTheChiz
quote:
give me some cons!
Besides the complex structure, high fees, capped gains, and pay or lose it?
Guessing the insurance rep is selling you on "guaranteed returns"
Forbes Advisor sounding alarm on IULs
Posted on 7/27/23 at 6:59 pm to HailToTheChiz
quote:
give me some cons!
Your "investment" is being bled by the cost of a potentially permanent life insurance policy.
No gains for 6+ years while the insurance company subsidizes the cost to produce the policy for you (aka opportunity cost).
Someone at some time may feel like they came out ahead (i.e. they didn't have any life insurance already, they were going to buy an extended term or permanent life insurance policy anyway, and the guarantee is good enough to offset the horrible time value of money horizon at origination for any other market driven investment opportunity which most certainly would outperform the guaranty due to the extended duration of the plan).
Posted on 7/28/23 at 12:04 pm to HailToTheChiz
quote:
give me some cons!
how about the fees and rising cost of insurance (annual renewable term inside the policy) that allows less and less to go to the cash (index). Think about having an S&P index fund where every year they raise the fees on you, in many cases the fees costing more than what you are paying in and they take out of the fund to pay those fees lowering the cash overtime. There's a reason for the minimum premium and target premium in these policies. Many of these policies implode on themselves leaving the client with no insurance or cash.
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