Can anyone explain the prons and cons of getting a Universal Life insurance policy? Thanks.
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Can anyone explain the prons and cons of getting a Universal Life insurance policy? Thanks.
There are many sources on the web that will save a lot of time typing in the pros and cons.
My conclusion is that if you are under 40, in good health, and need coverage then shop for a 10-20 year level term policy. You can pick up $500,000 cheap.
UL may sound good, but policy fees and Cost of Insurance is higher than term. In addition, any internal fund accumulations will be eaten up with surrender fees for the first 10 years. (You can't get your money out!)
Ugh, I won't have this discussion again on these boards. Adelina, I will PM you my opinion, please PM me if I forget this week.
Oh Kat, you are such a tease.
My first job was in Insurance company product development working on UL.
I just bought $500,000 of UL last year and even with the fact that I got all of the commissions and bonuses, it is not a good deal. I had a Million of YRT for years from a Mutual insurance company and it was the best decision I ever made. :O
Tax benefits
Estate planning
Those are 2 good reasons for perm. Life. If they are funded correctly and well allocated, who cares about the fees when the cash gains are tax-free. I like them for clients who have a large estate and don't want to pay estate taxes. We do it early, while they are qualify from a health perspective.
You have no place telling her its wrong Sitri, you do not know what her personal situation is looking like,
Well, excuuuuuuuuusssssssssseee me.
I don't believe anywhere did I say it was wrong. I am pointing out that unless you are over 40 and have over $1,000,000 in assets, your better probable option is to go for term.
I am a CLU, ChFC have spent many years designing insurance products, buying them, and selling them. I think my opinion is somewhat informed.
And while I do not know her specific situation, I doubt if she is over 40, has a million is hard cold cash and is worried at this stage of her life about estate planning...
I am only offering my advice not looking to get into a debate with you.
Diversification from a time perspective. When she is 40, she may not qualify for life insurance. While she is young and healthy, she can get a lower COI and begin to funnel money on top of that.