I Believe Whole Life/universal Life is a Waste

Discussion in 'Life Insurance Forum' started by Jonnyboy, Jul 17, 2015.

  1. Jonnyboy
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    Jonnyboy New Member

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    I see people always talking about the benefits of a whole life policy, but all I see in whole life is a waste for people who don't have an income of over 250k/year. Sure you can get tax benefits with it, but the people who say its an investment have to be retarded. Everyone knows you can get a better return on the market if you invest properly, sure their are ups and downs but the returns at the end of the day are greater than whole life. Also with the cash value if you withdraw the an amount that is greater than the premiums paid you get taxed. Taking a loan on the cash value you still have to pay a 5-9% interest and not to even mention how much the premiums cost yearly with a whole life policy compared to term. I just don't get the point of a whole life policy unless your rich and use it for tax purposes. Companies push this product heavily because of the amount of premiums they collect from it. My question is why would any agent recommend this product besides the fact that they can profit greatly from selling a whole/universal life policy?
     
  2. DHK
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    DHK Guru

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    I have no incentive to attempt to educate someone who already has their mind made up.

    There's a search function on the forum. I suggest you use it.

    Your understanding of insurance AND investments is severely lacking.


    EDIT: Oh, I suggest you quit this company now and figure out what you want to do.

    http://www.insurance-forums.net/for...ted-project-100-200-a-t75858.html#post1010081

    Since Robert Barney offers term comparison software, you may want to get a software license and just offer term insurance to everyone you know and be an independent agent.
     
  3. Robert Barney
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    Robert Barney Guru

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    Focusing on the cash values in a whole life policy is like focusing on the parachute in an airplane. Nice to have a parachute, but it has little to do with why most people get in an airplane to take a trip.

    If you are NOT buying whole life insurance for the lifetime death benefit, then you are probably in the wrong product.

    People who plan to cash out a whole life policy, are buying term (at a very high price).
     
  4. Jonnyboy
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    Jonnyboy New Member

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    Actually i have greatly appreciated advise given out in this forum its just that im reading so much stuff about the cons of whole life, if somebody can give me a link, description about whole life i'll greatly appreciate it. And I am working my warm market by the way so I don't know why you would bring that post up saying that I should just quit because I lack knowledge. Thats like telling a morbidly obese person to quit his/her weight loss journey because he/she lacks the expertise in dieting. Yes my understanding in insurance is lacking but im still learning. Whenever I am researching something I always read up on the pros and cons of any service/product. Im actually open minded and no i don't have my mind made up, that post was merely written to see if somebody would give a reasonable explanation on why whole life is beneficial. the one thing I would like to question is why is their such a high drop out rate when it comes to people purchasing whole life and lapsing their contract? I believe when it comes to insurance everyone has different needs, but what I would like to know is what else does whole life bring to the table? Especially when their are agents selling whole life products to families that can barely afford it and end up lapsing the contract a few years later. I will actually try to use the search engine I just thought it would of been faster to see how people would respond to this post.
     
  5. DHK
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    Jonnyboy... that's not the attitude you had in your first post of this thread. In essense, you said "prove to me that whole life is worth it over buying term and investing the difference in the market" and then gave some arbitrary numbers. Then you accused companies of essentially ripping people off for selling the product aggressively.

    That's not the attitude of someone who wants to learn about the many facets of permanent life insurance.

    Try these videos:
    10 minute lesson on life insurance:
    https://www.youtube.com/watch?v=Mpx2Jh87puA

    Ed Slott, CPA on retirement planning, taxes, and life insurance:
    https://www.youtube.com/watch?v=YYUHBF7jVEs

    As far as "policy lapse rates"... life happens. That doesn't necessarily mean that they were sold improperly. But these policies CAN be sold abusively.

    Families that can "barely afford it"... shouldn't be buying permanent life insurance. Permanent life insurance is a WANT product, not a NEEDS-based product. A family that can "barely afford it" should be buying term insurance in almost all cases. If they are to buy permanent insurance, it should be something they could easily afford.


    I would be curious to know which company you're contracted with. It's generally THEIR responsibility to train you and teach you this stuff.

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    But as far as quitting... you won't be effective in selling something that you don't know about, nor believe would positively impact the lives of others.

    Most captive agencies want you to sell their whole life product... but if you keep reading financial pornography and listening to Dave Ramsey, Suze Orman, and Primerica... you're going to have a hard time at your captive agency that wants you to sell whole life.

    That's why I suggested that you quit now, instead of trying to sell something that you don't understand or believe will make people better off.
     
  6. pfg1
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    pfg1 Guru

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    WL is an excellent product that offers guarantees. You definitely need to bone up, spouting off against it without knowing the facts doesn't hold water. We have a policy that is returning 350% of the premium annually every year, and all we have to do to get that growth is pay the premium. Sounds pretty horrible, I guess that policy should never have been purchased. IUL is also a good product, provided its designed and funded properly. Time to study up on what permanent life is actually about.
     
  7. cowgoesMoO
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    cowgoesMoO Super Genius

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    How about to protect insurability. People get bad diagnosis all the time, many of them in the last year of their term with no conversion options left.

    Maybe permanent life insurance isn't so bad after all....

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    what if after the Great Depression, someone with the same point of view tried to convince people that the stock market was a safe place to save for retirement. All you have to do is "invest properly". They would get laughed out of the building.

    The fact is it took America about 60 years to become naive enough to believe a lot of the bs your spouting. I've met with sooooo many people that lost 100's of K$s in 2007-8. And believe me they were investing the same way you would manage their money.

    And for the record, in the title of your thread, you blatantly state that you believe perm is a waste.....just saying.

    Now, I personally invest in the stock market, but not heavily and I look at it more like gambling, because I know that a long term indexing strategy will be more beneficial so that is where my retirement dollars go.

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    Jonnyboy, I didn't mean to jump down your throat. Most of us are always learning. Education is never finished.

    Every product has its place: term, whole, GUL, IUL, annuities, IRAs, 401k

    Always looking out for the clients best interests will make you the most money PERIOD!
     
  8. BNTRS
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    $250,000/year income is rich?

    :nah:
     
  9. DHK
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    That's what Obama thinks... so it must be true, right?
     
  10. scagnt83
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    scagnt83 Guru

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    Why would you guys waste your time with posts like these? If this guy really wants to know then he would spend a few hours reading the life section of the forum. There is more than enough info about the products and their use to form a knowledgeable opinion. Why put in effort for someone who is not willing to put in the effort themselves?
     
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