I have foolishly gotten myself into a financial crunch and I am hoping someone savvy can navigate me out of it. I took out 2 separate loans against a variable annuity that I have. One loan was for $2,500 and the other was for $7,000. At the time, I was in a tough financial situation and this seemed like a reasonable way to get out of it. Yeah, I was young and dumb when I did this, and to make matters worse I never repaid these loans. Now, many years later and interest later this debt has snowballed into $31000. Is there anything I can do to get around having to pay ALL of that? I mean after all the annuity only has a surrender value of $22k.
What are my Options?
- Thread starter I-GUY
- Start date
Keep in mind that you're paying back yourself.
Just start making payments. It's some forced savings and eventually, you'll wash the loan.
- 5,804
31K back into a variable annuity? Hmm... not sure I would head that direction... not looking at paper here.. that causes me to have indigestion.
Tough case.
Tough case.
Why?
Variable products are far superior in upside to fixed products.
Do invest in stocks/mutual funds etc. for retirement? That's all variable products do but they happen to have an insurance wrapper.
- 5,804
In my opinion many variable products are sold to folks who have no clue how to fly that spaceship. If we took a quick look at VUL's, and the number of them that have imploded, that would scare an average buyer.
- 5,804
So many unknowns here, but if he barrowed early in his coverage, I would assume this product may not have been the best for his case. Again, I don't know the full story, but I can guess that he was up sold on this and it didn't have a happy ending.
VULs should not be sold to "average" people. I've sold variables forever and what you're saying just isn't true for most buyers.
They're for HENRY (high earners/not rich yet) clients. People maxing 401ks/pensions/retirement plans and are looking for other tax advantaged growth strategies.
You won't implode a VUL or IUL for that matter if you design it correctly.
I'm not saying that some of these haven't been sold incorrectly, but that is true for all products. How many people buy FE when they could buy and qualify for a GUL at 1/3 of the price?
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