Sizzling Suze – Whole Life vs Term Life
Suze Orman recommends people buy Term life insurance and completely avoid whole life insurance. But you would think her employers do the same, but in fact they don’t. Watch to find out what type of insurance they do buy.
http://thepiratesofmanhattan.com/
Duration : 0:6:13
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I can show a policy …
I can show a policy where its even possible to borrow more than whats in your cv …. is round whatever they charge you , so if the charge 8% for your policy loan , your policy as increased either 9% 8% or 7% even maybe 10% , never 2%
Sideler74, you know …
Sideler74, you know the CV return is higher than 1-2%. Even people who are against WL policies will say you are wrong about that.
What policies have you seen exactly? Have you seen one from the companies I’ve named? Are you sure you know what your talking about?
wodendog: ALL CASH …
wodendog: ALL CASH VALUE LIFE INSURANCE IS A RIP-OFF. I’ve never came across a policy in 8 years where the CV was “gauranteed”. LOL The rate of return is abysmal, yielding 1-2%. WTF is that, my own personal growth mutual fund has averaged over 11.8% since 1992.
Again, the four …
Again, the four strong LI companies (MassMutual, Northwestern Mutual, NY Life, Guardian) all have guarantees in their WL products. However, each has historically been able to live up to their non-guaranteed WL projections. Feel free to contact them.
I don’t stick up for all companies, nor their products, but the ones I’ve mentioned are reliable. I am aware that there are bad Term and Perm products out there. I’m glad to hear you are trying to filter out the bad ones.
I very impressed. …
I very impressed. That’s very good background work.
However, it’s not all correct. Most illustrations gave a guaranteed Column on them, as well as non-guaranteed Column. The non-guaranteed column does have lower numbers that the company legally has to show, even though the discussion with the client usually revolves around non-guaranteed column.
One of the strong points that WL has over other permanent products is that is has these “guarantees”. It is talked about quite often.
To add to my …
To add to my previous post. I have been @ clients homes where the rival insurance companies agent was present. When asked “is the cash value gauranteed” they talk in circles. THEN when I pull out a tape recorder & ask them to repeat that they just said about the CV being “gauranteed” get ed & they clam up & won’t say a word. Why’s that? If they have nothing to hide then why do they refuse to speak while being recorded? All that does is add a new client to my business. Thanks
wodendog: I’m in …
wodendog: I’m in the buisness as well. I am Life Licensed in New Jersey. Try this: Go to the back of your police, open it up & call the 1-800 # in there. Ask them “is my cash vaklue gauranteed”? I promise you they will SAY NO. I’ve sat with clients who had Whole Life, Variable Life etc etc, they didn’t believe me until we call the 1-800 # in the back of their policies. They were floored when they heard the words “your cash value is not gauranteed”. Fact is: The Agents lie, but the Company can’t
Cash Value is part …
Cash Value is part of the death benefit , when whole life came out it was protection of all deaths including disability as a death and retirement , hence they made cash value ….
But why take my …
But why take my word for it? If you live in a major city in the US, then you can contact a rep at MassMutual, Northwestern Mutual, NY Life, or Guardrian, and they will literally show you their own policies, or policies of their clients, or illustrations to show you how it works.
I’m not lying and I know how it works. If you keep looking into it, you’ll find that what I say is true. However, you may have to look outside the sources your use to in order to find the answers.
I’m sorry Sideler74 …
I’m sorry Sideler74, but you are incorrect. I know that’s what you have been told, but you have been misinformed. I have been in the business, I have seen policies that verify what I have said, and I have even posted the numbers off my own policy on one of these posts to prove it.
If your truly seeking the truth, keep looking. Suze largely preaches to a audience where term usually is the right path for them. However, for millions of Americans, her advice is off (though well intended).
Suze Orman is a …
Suze Orman is a personal finance advisor, not an advisor to LARGE companies. They listen to who they want & do what they want with their money, just like you & me. Anyone who owns a Cash Value Whole Life is getting robbed blind.
wodendog: Wrong, …
wodendog: Wrong, the correct answer is that the insurance company pays your benificiary the $250.000 & they KEEP the $60,000 in CV thus off setting their losses to the tune of $190,000. So the client pays for “insurance & savings” & they only get one. That’s a RIP OFF.
Sideler74, It does …
Sideler74, It does depend on the type of policy you have , how it’s structured, and where you got it from. If we ume it is a standard policy (not over funded, not mixed) then after 25 years your policy might be worth around 500K (ballpark). IF this is the case, and you die, your family would get 500K, not the 60K in the cash value. Remember, Death Benefits grow in most WL policies, usually more than the Cash Value.
wodendog: Heres a …
wodendog: Heres a question: What happens to my cash value when I die? Who gets it? Example: I have a $250,000 WL policy & after 25 years I’ve built up lets say $60,000 in CV. Then I die how much does my family get? Please respond. Thanks
If you actually …
If you actually understand whole life , youl know poor people need it the most ….
Hi Alex,
What …
Hi Alex,
What are you doing tomorrow?
Doesn’t astroman suck at selling filters?
Sorry I had so many …
Sorry I had so many posts. I won’t be doing that again any time soon. Sadly, I could have put in a lot more info and probably structured it more clearly.
Keep it real Barry, I like your book so far.
Part 10 of 10: My …
Part 10 of 10: My figures (60-35-5) are rough ballpark figures. The real breakdown could be 40-40-20 or 50-40-10 or whatever. The main point is that Term is best for many people, while WL or a combination of WL/Term is best for others.
Also, don’t forget that WL insurance is usually the cheapest and most reliable way to pass along money when you die. WL policies also have a disability waiver that says the company will pay for the policy if the insured becomes disabled, which is VERY significant.
Part 9 of 10: This …
Part 9 of 10: This all leads me to believe that the poor, lower middle class, and many in the middle class (60% of pop) need only Term. The wealthy (5% of the pop) need only WL. The upper middle class and some middle class people (the remaining 35%) need to decide based on whats best for them (most needing at least some WL coverage).
Obviously, a persons insurance needs are based on their situations in life, and there are MANY more factors to discuss as well as certain aspects of LI.
Part 8 of 10: The …
Part 8 of 10: The tough decision making between Term and WL usually falls on the shoulders of the Upper Middle Class (and some in the MC as well). The price and early liquidity of WL is still a significant factor for them, and they won’t always benefit as much from the Estate/Death and Capital Gains Taxes. So, they’ll have to decide between Term, WL, or a combo of both.
Part 8 of 10: The …
Part 8 of 10: The tough decision making between Term and WL usually falls on the shoulders of the Upper Middle Class (and some in the MC as well). The price and early liquidity of WL is still a significant factor for them, and they won’t always benefit as much from the Estate/Death and Capital Gains Taxes. So, they’ll have to decide between Term, WL, or a combo of both.
Part 7 of 10: Also …
Part 7 of 10: Also, the cash value which they can access has no capital gains tax (which wealthy people get hammered on because they pay higher CGT than the average person. For wealthy people the disadvantages of WL are minimal, and advantages are significant. WL is a good deal for them.
Part 6 of 10: At …
Part 6 of 10: At the other end of the spectrum we have the rich. The fact that WL is expensive doesn’t effect them as much, nor does the fact that it is not liquid in its early years (wealthy people usually have many different investments, many of which are plenty liquid in the short term). Plus, wealthy people get a lot of tax advantages from WL. It can help to absorb Estate/Death taxes when they die.
Part 5 of 10: The …
Part 5 of 10: The average person simply can’t have a substantial portion of their money tied up in a policy that they can’t tap into efficiently.
So, WL is expensive and a poor quality short term investment. Because of this, it is often times not a good choice for the poor, the lower middle class, or even many in the middle class.
Part 4 of 10: What …
Part 4 of 10: What % of the population needs Term and/or WL? WL has a number of advantages over Term, but it also has weakness. First, WL is expensive. The average American generally can’t cover their LI needs with just WL. If you need 1 Million of coverage and you make make 50K a year, 100% WL is not for you. Second, WL is not a very good place to put money short term. The CV simply isn’t efficient enough in the first 10 years of the policy.