Universal Life Insurance. Yay or Nay? - Page 5
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Thread: Universal Life Insurance. Yay or Nay?

  1. #41
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    Quote Originally Posted by OptsyEagle View Post
    I probably missed the mark but if it was easy to understand, many of those insurance companies would be hurting to find new customers.
    Sadly, this is relevantly true.


  2. #42
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    Quote Originally Posted by Nerd Investor View Post
    Unfortunately, from what you've told us this does not seem to be the case.
    Yes, this is quite true.

  3. #43
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    Quote Originally Posted by Nerd Investor View Post
    It may be more appropriate for your parents depending on their financial situation. Think of permanent insurance (not necessarily universal) as a long-term, tax sheltered investment, but one that isn't accessible until death. This is overly simplistic and not really accurate but it will at least help you get to the right frame of mind in terms of whether it makes sense. So when would this make sense? When you have (or expect to have with a reasonable degree of confidence) excess non-registered investments that you are confident you will not need or want to access for yourself.

    There are other situations when it would be warranted as well, but thinking through the above will tell most people whether it's worth considering. If the answer is yes, then you have to look at the death benefit paid out, a reasonable expectation of cash surrender value (if any), and figure out the equivalent rate of return to see if it makes sense as an investment.
    I believe the financial situation of my parents are not that good. I am seeing myself now sitting with them and try to convince them to get rid of their UL plan as well. Any idea on how I would make a valid point to them and make them hear what I am saying? I know it's going to be tough for me as I am just starting to learn from you guys here.

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  5. #44
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    Think of insurance as a form of risk management. You are passing along the risks of what you cannot insure, on your own, to someone else (i.e., a life insurance company).

    When at all possible, you self-insure since the money you pay someone else to insure your assets or cover your liabilities is money you could have kept (and grown) for yourself. Life insurance is therefore not for you, it's for your family.

    There are times to have life insurance and times when you don't need it IMO. If and when you have 1) no liabilities and 2) enough income coming in when a catastrophic event (your death) will not harm the family's income needs, then 3) you probably don't need life insurance.

    No idea if this is helping
    Hidden Content - Working on a $1 million portfolio and $30k per year from it.

  6. #45
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    Quote Originally Posted by My Own Advisor View Post
    There are times to have life insurance and times when you don't need it IMO. If and when you have 1) no liabilities and 2) enough income coming in when a catastrophic event (your death) will not harm the family's income needs, then 3) you probably don't need life insurance.
    Personally I think this is why in addition to the excess fees UL isn't a great product for most people. It ties investments and life insurance together in a way, so that while you might be at a point in your life that life insurance doesn't necessarily make sense for you, you are tied to it because it's also your investment.

  7. #46
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    Agreed Potato!

  8. #47
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    Quote Originally Posted by My Own Advisor View Post
    No idea if this is helping
    It sure does. Thank you so much. It gives a brighter perspectives for people like me who has little knowledge about life insurances/investments.

  9. #48
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    We always viewed investments and life insurance as separate items. We found the combineded products confusing and we believe that where there is mystery there is margin. We like it simple. So we did our best deal on a pure insurance product.

    We stuck with term life, as much as possible when the risk was high. Our circumstances did not warrant whole life.


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