The financial and insurance industries have gotten a bad rap. We all know what the stock market has done in the last 12 years. And, for many, which insurance products did them no justice as well.
For instance, in the 80’s when the Universal Life (UL) product first came out, it was not good timing. You see, since,1929, the prime rate has mostly been in the single digit range. However, for a period of about 6 years, in the late 70’s to mid 80’s, the prime rate peaked at a high of 20.5 percent. And, right in the middle of this came the Universal Life policy. So when projections were used during this time, which is what they are, not guarantees, based on interest rates (which makes up this traditional Universal product), they were extremely high. However, interest rates began to fall – and fall they did. This left clients unhappy with the performance of their policy and agents scrambling for shelter.
And the Variable Universal Life product is the other policy that gave “Universal” a bad image. It can be a good product, if you know the risks going into it AND be certain that you review your policy on a yearly basis. This VUL performance is based on the stock market – both the ups and downs. And, as has been shown over and over again, even if it goes up and up and up, it will ALWAYS come back down. This product also has high fees and admin costs associated with it.
NOW, when I first learned about the Indexed Universal Life product, I was not only excited but got passionate about money, finances and yes, life insurance. This product came out in 1995 and it’s not like any other insurance product out there. So, you’re wondering why you haven’t heard about it? Well, after all the bad press with universal policies, this one has been slow coming out of the gate. But, as you will learn now, it’s an amazing product for both protection and as a retirement vehicle.
Here’s a list of common characteristics that this SUPER Universal life insurance product delivers on:
- Death Benefit
- Cash Accumulation
- Protection Against Market Loss – YOU WILL NEVER HAVE TO EXPERIENCE A LOSS, YES NEVER!
- The Annual Reset Provision
- Upside Growth Potential
- Tax-Deferred Growth
- Tax-Free Access to Cash Accumulation
- No Minimum Age or Income Requirement
- No Mandatory Distribution
- Access at Any Age
- Protection From Lawsuits
- Continued Investment if Disabled
- Does Not Create Taxation of Social Security Benefits
- Avoids Probate
- Accurate Return Figures
If you’re accustomed to working with a financial planner and you have your money in the stock market, I sure hope it has been for you. Because I do believe I’m correct in saying that what goes up must come down and from my point of view, that would mean that if one has money “in” the market, you are literally always making up for losses. Why wouldn’t you want to put your money in a safe place? A place where you could never lose?
I’m a proponent of Patrick Kelly who authored Tax-Free Retirement and The Retirement Miracle. His books are easily understood and a fabulous reference to what I’m passionate about – taking care of yourself and putting your money in SAFE places for growth, protection and accumulation for retirement. You can find his books on Amazon.
In my next post, I’ll be going over Annuities, and mostly my absolute favorite – The Fixed Indexed Annuity. So, please be sure to sign up so you will automatically get this in your email box.
(c) 2013 D.C. Brown