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4star and Stevuke
Thank you both for your comments. Believe me I read all responses several times. Both of you gave me a lot to think about.
4star, you offered encouragement with the warning I better understand the product before I jump on it. Stevuke, you counseled prudence and warned how premiums could skyrocket.
Just to let you folks the warnings did not go on deaf ears and to let you know the angles I am working (be it UL or VUL I end up with for them):
1. They are yooung now. Heck even 30 years from now the premiums will still be quite manageable.
2. The UL I am contemplating offers a higher guaranteed interest rate than the WL.
3. This is a great all-in-one product. Now, like any all-in-one tool, there are trade-offs. Here I can get them life insurance, a CV to access in an emergency, a tax deferred savings vehicle (like an IRA),
4. I figure that down the road, hopefully they built up the CV (so amount at risk is low and they get lower premiums), in any event, when the CV gets high enough so the life insurance provided by the policy is only a token amount to keep it within IRS statutory requirements they can buy an annuity or do a 72(t) withdrawal.
5. I think to keep pace with inflation, you need the higher guaranteed interest rate from UL or the higher risk of equity investing in VUL.
6. Bottom line is I am a small time guy with a Joe Sixpack budget, therefore, I need to take a bit of extra risk using equities. Ofcourse, I plan to pay more than minimum premium.
Also, If an IRA were available to them, I would not do this. I would put their money in an IRA. So, my next choice is a variable annuity...BUT, once you factor in the fees they charge, a life insurance policy (at least for a juvenile) just seems plain cost effective.
Again 4star and Stevuke, thanks for your thoughts, your warnings, your perspectives, and your advice.
Thank you both for your comments. Believe me I read all responses several times. Both of you gave me a lot to think about.
4star, you offered encouragement with the warning I better understand the product before I jump on it. Stevuke, you counseled prudence and warned how premiums could skyrocket.
Just to let you folks the warnings did not go on deaf ears and to let you know the angles I am working (be it UL or VUL I end up with for them):
1. They are yooung now. Heck even 30 years from now the premiums will still be quite manageable.
2. The UL I am contemplating offers a higher guaranteed interest rate than the WL.
3. This is a great all-in-one product. Now, like any all-in-one tool, there are trade-offs. Here I can get them life insurance, a CV to access in an emergency, a tax deferred savings vehicle (like an IRA),
4. I figure that down the road, hopefully they built up the CV (so amount at risk is low and they get lower premiums), in any event, when the CV gets high enough so the life insurance provided by the policy is only a token amount to keep it within IRS statutory requirements they can buy an annuity or do a 72(t) withdrawal.
5. I think to keep pace with inflation, you need the higher guaranteed interest rate from UL or the higher risk of equity investing in VUL.
6. Bottom line is I am a small time guy with a Joe Sixpack budget, therefore, I need to take a bit of extra risk using equities. Ofcourse, I plan to pay more than minimum premium.
Also, If an IRA were available to them, I would not do this. I would put their money in an IRA. So, my next choice is a variable annuity...BUT, once you factor in the fees they charge, a life insurance policy (at least for a juvenile) just seems plain cost effective.
Again 4star and Stevuke, thanks for your thoughts, your warnings, your perspectives, and your advice.
