Life insurance Rule or Regulation Question

Nov 19, 2018

  1. AboutThatLife
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    AboutThatLife Guru

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    What determines if it is appropriate or not? Client wants tax efficiency, fixed credited interest, no market risk, and to protect their assets.
     
  2. DHK
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    DHK "YOU CAN'T HANDLE THE TRUTH!"

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    In my opinion, many advisors / planners look at financial planning like "net worth" planning: "Let's get as many dollars to show up on your "net worth" statement and since life insurance has a low return, it sucks for building up your net worth."

    (I have yet to see an "estimated taxes due" column near a qualified plan entry on a net worth statement or even an IRA/401(k) account statement. Nor a risk tolerance threshold that incorporates a 50% loss in a financial plan.)

    I look at cash flow, liquidity, use, and control of one's finances. Life insurance is pretty awesome for that - as long as there is sufficient bank savings and cash flow during the early years to keep funding it.

    https://davidkinderfinancial.wixsit...s-Your-Financial-Planning-Pyramid-UPSIDE-DOWN
     
    Last edited: Nov 25, 2018
    DHK, Nov 25, 2018
    #22
  3. Golfnut2112
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    Golfnut2112 Guru

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  4. VolAgent
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    VolAgent Guru

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    Having all the facts, would a prudent person make the same decision. Pretty nebulous, right? That is kind of the core of the problem here. There are plenty of agents who are truly trying to help families with life insurance. There are plenty more who are simply looking for the big commission check. At the surface, they are hard to tell apart as they both talk the same talk. You have to get deeper into it to sort them out.
     
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