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to add to moon's points... it's what they let you keep and what they count and what you have left over at the end.
Along with RISK.
Along with RISK.
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In some very limited circumstances, it can actually be an excellent investment vehicle.
Let's say you have a high earning physician that is currently maxing out all tax-favored accounts.
An over funded VUL (non-MEC of course) can be an excellent wealth play. Additionally here in Florida (as in many states) life insurance cash values are creditor-proof.
If he/she can use the DB -- all the better...
I just don't see the tax advantage of taking/borrowing against the cash value. Especially when the client is using after taxed $ to pay the premium.
Well, the more money the agent makes, the less money there is available for the client to work with. I once went to some dopey seminar and walked out when they started talking about a 20-year surrender period. If some dumba$$ can say that with a straight face to a client, I believe that same dumba$$ will be able to sell a ROP health policy to a 25-year old.
The advantage is this: growth in the cash value is tax-deferred. You can access this growth tax-free by taking a loan that you don't have to pay back.
This is what's called a "greed" sale.
Term life insurance, on the other hand, is a "need" sale.
The advantage is this: growth in the cash value is tax-deferred. You can access this growth tax-free by taking a loan that you don't have to pay back.
This is what's called a "greed" sale.
Term life insurance, on the other hand, is a "need" sale.
And what happens when the client outlives the term policy and has to rebuy, at an outrageous price in their 60s 70s or 80s?
I like the use of whole life due to the fact of the premiums being level until death. Also the cash in the policy can be used .....SHOULD ONLY BE USED IN EMERGENCY SITUATIONS.
I do sell term as well, mostly to young singles/families just starting out and need insurance but cant afford whole life at the time. And then when they are ready to convert they can do so without any underwriting involved. So I guess I mostly use term as an insurablity protector, while covering the client with the death benefit as well.
OF COURSE THIS IS JMHO