Whole Life Investment (by WMH [NC]) Jun 11, 2019 5:45 PM|
Whole Life Investment (by S i d [MO]) Jun 11, 2019 5:50 PM
Whole Life Investment (by GKARL [PA]) Jun 11, 2019 6:00 PM
Whole Life Investment (by WMH [NC]) Jun 11, 2019 6:17 PM
Whole Life Investment (by plenty [MO]) Jun 11, 2019 6:30 PM
Whole Life Investment (by plenty [MO]) Jun 11, 2019 6:35 PM
Whole Life Investment (by Robert J [CA]) Jun 11, 2019 6:37 PM
Whole Life Investment (by WMH [NC]) Jun 11, 2019 6:44 PM
Whole Life Investment (by JR [ME]) Jun 11, 2019 7:21 PM
Whole Life Investment (by WMH [NC]) Jun 11, 2019 7:37 PM
Whole Life Investment (by Barb [MO]) Jun 11, 2019 7:50 PM
Whole Life Investment (by Ken [NY]) Jun 11, 2019 8:09 PM
Whole Life Investment (by #22 [MO]) Jun 11, 2019 8:42 PM
Whole Life Investment (by livethedream [AZ]) Jun 11, 2019 9:27 PM
Whole Life Investment (by GKARL [PA]) Jun 11, 2019 9:50 PM
Whole Life Investment (by MMIT [VA]) Jun 11, 2019 10:35 PM
Whole Life Investment (by Robert J [CA]) Jun 11, 2019 11:40 PM
Whole Life Investment (by nhsailmaker [NH]) Jun 12, 2019 7:30 AM
Whole Life Investment (by WMH [NC]) Jun 12, 2019 8:08 AM
Whole Life Investment (by Steve [TN]) Jun 12, 2019 8:27 AM
Whole Life Investment (by WMH [NC]) Jun 12, 2019 8:58 AM
Whole Life Investment (by S i d [MO]) Jun 12, 2019 9:26 AM
Whole Life Investment (by Landlord ofthe Flies [TX]) Jun 12, 2019 3:50 PM
Whole Life Investment (by Ray-N-Pa [PA]) Jun 13, 2019 8:54 PM
Whole Life Investment (by Ray-N-Pa [PA]) Jun 13, 2019 9:00 PM
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Whole Life Investment (by WMH [NC]) Posted on: Jun 11, 2019 5:45 PM
Not to increase wealth. To leave more than you actually have to kids, especially grandkids.
PLEASE don't tell me about Dave Ramsey or Suze Orman. They cater to a different market (those who can't pay their own bills, let alone leave money!) --50.82.xxx.xx
Whole Life Investment (by S i d [MO]) Posted on: Jun 11, 2019 5:50 PM
Here's one thing Dave Ramsey doesn't say much or anything about in regards to Whole Life. I don't think Suze Orman does either.
"If a Medicaid applicant has term life insurance, it doesn't count as an asset and won't affect Medicaid eligibility because this form of life insurance does not have an accumulated cash value. On the other hand, whole life insurance accumulates a cash value that the owner can access, so it can be counted as an asset."
As an asset, whole life must be shielded and protected just like any other asset from lawsuits and/or claims of liability. I would speak to a competent Elder Care and also Liability attorney. --173.20.xxx.xxx
Whole Life Investment (by GKARL [PA]) Posted on: Jun 11, 2019 6:00 PM
I'm an advocate of funding mutual funds with the incremental premium for whole life and using term life for insurance. The challenge is that term premiums are more expensive the older one is but that holds for whole life as well. Basically, I keep insurance and investing separate as the need for insurance diminishes as one builds assets. I'd be looking to build up investment assets specifically for the grandkids. I have a very 500,000 group term policy that costs me about 1500 a year. That's cheap enough for me not to worry about "paid up" whole life. --208.54.xx.xxx
Whole Life Investment (by WMH [NC]) Posted on: Jun 11, 2019 6:17 PM
We are in our middle 60's. We don't need life insurance. But if we could "gift" the grandkids with paid-up cash-out policies, that's very enticing. --50.82.xxx.xx
Whole Life Investment (by plenty [MO]) Posted on: Jun 11, 2019 6:30 PM
There was just a financial guy stating such on PBS a week ago. I'll see if i can find him name. Good idea. Been thinking the same as all other investments are maxed out and there is extra cash flow that coukd equate to a hold lot more! --99.203.xx.xxx
Whole Life Investment (by plenty [MO]) Posted on: Jun 11, 2019 6:35 PM
Google: Retire Safe & Secure with Ed Slott --99.203.xx.xxx
Whole Life Investment (by Robert J [CA]) Posted on: Jun 11, 2019 6:37 PM
Proper planning is important. If you give your kids everything early on in life than they won't learn how to fend for themselves.
A well thought out Family Trust that produces income through property ownership can provide a monthly supplements for the kids and grand kids. Also with the stepped up basis, they can start to re-depreciate the asset again shielding much of the income from taxes.
Everyone knows if you give an untrained investor a chunk of change, then they will blow it in no time at all.
The average million dollar lottery pay out only lasts around 1-1/2 hears for the recipient.
One x-partner's parents left 100M to their 4 kids. All of a sudden divorce was the flavor of the month. Now the 4 kids and 4 X's had to split their 25M in half. It's hard to live on only 12-1/2M. Do you know how much of the original 100M went to the grand children? To date, ZERO! Not what the original earner wanted.... --47.156.xx.xx
Whole Life Investment (by WMH [NC]) Posted on: Jun 11, 2019 6:44 PM
RobertJ my kids are in their 40's. Grandkids are my concern. --50.82.xxx.xx
Whole Life Investment (by JR [ME]) Posted on: Jun 11, 2019 7:21 PM
Due to the high, borderline shameful, sales fees associated with whole life policies, purchasing term life policies and investing the difference in cost in a good no load mutual fund will work out better for your heirs.
WMH, you can be straight with us, this was someone else’s idea, not yours? --98.13.xx.xxx
Whole Life Investment (by WMH [NC]) Posted on: Jun 11, 2019 7:37 PM
JR, the shame of buying Whole Life is something we are actively discussing. :) --50.82.xxx.xx
Whole Life Investment (by Barb [MO]) Posted on: Jun 11, 2019 7:50 PM
Hubby and I have whole life policies we bought in 1993, when I was pregnant. Mom has one about the same age. I looked into them for my kids recently and the premiums are way higher than what we pay. Better to simply put an amount into savings each month. --64.251.xxx.xxx
Whole Life Investment (by Ken [NY]) Posted on: Jun 11, 2019 8:09 PM
WMH,why don't you just buy a rental that the grandkids can learn how to help take care of it and eventually give it to them once they have earned the right to it by taking care of it and helping manage it etc instead of what just seems like free money they didn't earn. --72.231.xxx.xxx
Whole Life Investment (by #22 [MO]) Posted on: Jun 11, 2019 8:42 PM
Absolute garbage. The only people saying good things about it are the salesman. Very, very rare situations where it makes sense.. --173.25.xxx.xxx
Whole Life Investment (by livethedream [AZ]) Posted on: Jun 11, 2019 9:27 PM
aI second #22 and Dave Ramsey. Term life only. I pay around $150 for a million. If I make it ten years we've invested $150k for a million return for my spouse.
Whole Life Investment (by GKARL [PA]) Posted on: Jun 11, 2019 9:50 PM
Whole life insurance in your 60's is going to be prohibitively expensive and the cash value element will be marginal. Check out the following chart on premiums:
The monthly premium for a 65 year old male is 1123 for $ 250,000 of coverage (assuming good health). At age 65, there's not a whole lot of time for any cash to build up and in comparison to alternatives, it's really not effectively. Let's assume you were to invest $ 1123 a month in a conservative mutual fund that returned 7% annually, in 10 years you'd accumulate $ 197,800. Cash value buildup on the whole life policy isn't going to match that.
$ 250,000 of term will run about half of the cost of whole life and you could lessen the cost by limiting the term, but keep in mind that death is closer rather than far at age 65 thus coverage gets more expensive. Moreover, the need for insurance diminishes as one builds assets. I'd probably go with minimal term insurance amount and invest in mutual funds or other real estate for the grandkids. --209.122.xx.xxx
Whole Life Investment (by MMIT [VA]) Posted on: Jun 11, 2019 10:35 PM
A life insurance/financial planner spoke at our REI meeting last month. She said she can use IRA money to buy whole life policies and avoid paying taxes on the IRA money. The life insurance payout is also tax free.
She said her commissions were less than the taxes you would pay on a normal IRA distribution.
She was also mixing annuities into what she was proposing.
She makes a lot of money selling these products.
When I analyze the numbers, I think that is a good approach for a lot of people, but, I can do better with real estate, IRA's, and Roth IRA's.
Let us know what you decide and why you made the decisions you did.
Thanks and good luck! --70.188.xx.xx
Whole Life Investment (by Robert J [CA]) Posted on: Jun 11, 2019 11:40 PM
My friends are also concerned about leaving something for their kids and grand kids. Since the kids and grand kids were spoiled and my friends worked 7 days a week working on their rental -- property rich -- when they die there was no one to take over the management. So instead of having a dozen little properties all over town, I got them to exchange into a large complex with an on site manager and a property management firm doing all of the work -- and sending monthly checks to the owner....
So when my friends could no longer manage their income property, they are turning 90, they have in place the people to run things for them...
The property is in trust and when they die the children and grand children do not control the trust, but instead get the proceeds. --47.156.xx.xx
Whole Life Investment (by nhsailmaker [NH]) Posted on: Jun 12, 2019 7:30 AM
STOCK CARS: my body and my money have the stock car plan
stock cars should be built to fall apart 1 car length after the finish line --24.62.xxx.xxx
Whole Life Investment (by WMH [NC]) Posted on: Jun 12, 2019 8:08 AM
This was a topic of one of the Speakers at the Convention. How to build generational wealth using life insurance. That you can buy Whole Life, borrow against the policy to buy other investments (such as real estate) and pay yourself back with interest.
My generation grew up thinking Whole Life was the devil. That smart people bought Term Life and invested the rest. Which is what we did: bought a half mil 20 year term life (on each of us) that ended a few years ago. Spent just about $48k on that insurance over the 20 years. If we had purchased a single-pay Whole Life, what would have been the cash value 20+ years later? I wonder. No idea.
People say, "OH but there are commissions involved." I was a salesperson my whole working life: commissions are not evil. But of course you don't want to overpay for anything, and you don't want to buy into something stupid.
But we can't contribute to IRAs or 401k's, in fact too soon we will have to start taking the RMD. We don't want any more houses, at least we are not actively looking any more. We have enough in the stock market, especially for our age.
We could do private lending but don't really want to deal with that risk.
Grandkids are 15 and 22.
Robert J, I have 3 adult children and 2 grandchildren. No worries about any of them inheriting too *much* to deal with LOL! --50.82.xxx.xx
Whole Life Investment (by Steve [TN]) Posted on: Jun 12, 2019 8:27 AM
If your goal is to leave a legacy for your heirs … Statistically, you will likely leave them much more if you put all the money that would have gone to premiums into the stock market. Buy a single or a small handful of growth ETFs or mutual funds. Like an S&P 500 or total US stock market. Unless you only have a few years to live, that is.
The insurance companies are in business to make money. And while they many not make any on you should you die young, once again, statistics are not in your favor. To make money, the life insurance company must charge you more in premiums and commissions than they will ultimately pay out to your heirs.
So, just cut out the middle man (insurance companies), open up a Vanguard, Fidelity, Schwab, etc. account and start building your legacy. --68.156.xx.xx
Whole Life Investment (by WMH [NC]) Posted on: Jun 12, 2019 8:58 AM
Steve, that's all been done. We are just looking for additional vehicles.
We are too old to buy insurance on ourselves, and don't need it anymore anyway. --50.82.xxx.xx
Whole Life Investment (by S i d [MO]) Posted on: Jun 12, 2019 9:26 AM
WMH, you asked what would your growth have been had you put $48K into a whole life policy over 20 years. There are calculators online that can help you compute that. Granted, there are some assumptions you'll have to make, but you can get a spit-ball's distance from it at least.
We can't go back and redo the past, however, so what we really need to focus on is the future. This article from Consumer Reports may be helpful.
Basically, the gist I get out of it is whole life guaranteed cash payments are below that of t-bills today, but could possibly rise if the company performs well. One must also consider this question: "How do whole life insurance companies achieve a good enough return to be able to pay out guarnateed returns?" The answer is simple: they take your premiums, take out their overhead and profit, and invest the rest.
Why not just do that yourself and skip the expenses and profit to insurance company takes?
Unless you're planning on gifting multi-millions to the next generation, you won't have to worry about estate tax. You can even gift while still alive up to $15,000 per person per year and not get his with any gift tax. I don't know what the size of the state you're planning to leave is, so again, I recommend talking to a competent Estate Planning attorney.
Also, you didn't respond to my mention of the potential risk of a policy with cash value being hit by Medicaid spend down rules and/or risk of being seized to pay law suit judgment, so just wanted to re-highlight that here in case you missed it. A whole life policy has that risk, just like any other asset class. --173.20.xxx.xxx
Whole Life Investment (by Landlord ofthe Flies [TX]) Posted on: Jun 12, 2019 3:50 PM
To give more than you have? With that stipulation, I can only think of a life insurance policy. My mother did something like that for me by putting a life insurance policy in a irrevocable trust and to use the money from that policy to help pay down the inheritance taxes owed from her estate.
By being an irrevocable trust, she didn't own it and it wasn't subject to any estate or inheritance taxes but it also means anything you put in there is no longer yours.
You can set one up for each of the kids/grandkids and put a policy in there with them as beneficiaries at your death. Best of all, since the trust only owns an insurance policy, it pays no taxes because there's no income. And insurance policies are not taxable when they pay off.
If the amount contributed to make payments on policy is less than the annual gift amount you're allowed to give, or lifetime giving amt, you don't even owe gift taxes.
Definitely involve a lawyer and accountant for this. --108.69.xxx.xxx
Whole Life Investment (by Ray-N-Pa [PA]) Posted on: Jun 13, 2019 8:54 PM
How about placing your property in a Charitable Remainder Trust (CRT) and carry a term policy equal to the value of the piece of real estate.
At your death, agree to give either the piece of real estate or the insurance money to the charity that you want to endow.
By doing in this manner, you can buy cheaper term insurance and even give away places that you may even owe on.....when you pass.
Whole Life Investment (by Ray-N-Pa [PA]) Posted on: Jun 13, 2019 9:00 PM
I bought that 12 year old's book from the convention. I am impressed about what he is doing - I plan on giving my 26 year step son the book. He has done more at age 12 than I did at age 30 - and that was decades ago for me
So Are you trying to feed someone a fish or are you trying to teach them how to fish? --24.101.xxx.xx
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