That is why I use WL alot. When properly designed and funded, it can have a very nice long term IRR, without the worries of no guarantees. In addition to a good investment strategy, you have a non correlated asset that gives a bond like return (or better). I think having BOTH cash value ins and investments is key to a well balanced portfolio, even more so if you are married with a family.
Looking for properly designed EIUL from NA
- Thread starter js44
- Start date
- 10,318
It takes 15-25 years for an IUL to go bust if the market returns 0% or negative every single year. Options would be bust after a maximum of 5 years... most expire after 1 year or less.
You can generate income on options, but its not going to put you in the positive if your options expire out of the money.
So any alternative thats invested in just options would be bust well before a properly designed IUL would be.
You can do a ROTH SEP, but you are limited on how much you can contribute each year. It also comes with a whole lot of other restrictions.
You can do a ROTH IRA, but then you are even more limited on contributions.
Neither would be an appropriate option for someone wanting to utilize those funds before age 60.
What attracts people to IUL or WL, is that it is a "turn key" solution. Its not something that must be constantly managed. It allows people to concentrate on their investments that must be managed and reviewed monthly/weekly/etc. It also allows them to take on more risk with those investments.
Its for people who realize time is one of their most valuable assets.
Some of the biggest fans of IUL are traders at hedge funds and big wall street firms. They understand Sharpe Ratios, and know that it would be impossible to replicate the same risk-adjusted return on their own without it becoming a full time job.
You can generate income on options, but its not going to put you in the positive if your options expire out of the money.
So any alternative thats invested in just options would be bust well before a properly designed IUL would be.
You can do a ROTH SEP, but you are limited on how much you can contribute each year. It also comes with a whole lot of other restrictions.
You can do a ROTH IRA, but then you are even more limited on contributions.
Neither would be an appropriate option for someone wanting to utilize those funds before age 60.
What attracts people to IUL or WL, is that it is a "turn key" solution. Its not something that must be constantly managed. It allows people to concentrate on their investments that must be managed and reviewed monthly/weekly/etc. It also allows them to take on more risk with those investments.
Its for people who realize time is one of their most valuable assets.
Some of the biggest fans of IUL are traders at hedge funds and big wall street firms. They understand Sharpe Ratios, and know that it would be impossible to replicate the same risk-adjusted return on their own without it becoming a full time job.
- Thread starter
- #53
- 11,272
I am not licensed to do business in Illinois with no desire to do so.
- 15,041
A real adviser is likely to only put a small portion of your money in options, if they will even do it.
Options are high work/high risk/high reward. They don't even belong in the same universe as IUL. IUL is very low maintenance/lower risk/lower reward.
If you want to go do options, do it. More power to you. I don't think a person on the forum would want to stop you. But don't think it is remotely comparable to an IUL.
Its like comparing the driving experience of a 90s era Formula One car to Google's latest self-driving car. One is all about you and how well you can do. Exhilarating, but very risky if you aren't up to the task. The other, you can pretty much lay back and take a nap.
- 11,272
I used agent/advisor interchangeably in this context. What he needs is someone who won't tell him what he wants to hear and challenge his own assumptions. And someone who is well-versed with all the benefits of a permanent life insurance planning strategy beyond trying to get a higher rate of return.
- 15,041
Knock yourself out. I wouldn't touch this guy. His risk/reward matrix is all messed up. Put him in something that matches his risk, he'll complain about returns. Put him in something that matches his reward, he'll complain about losses and volatility.
I will say this, the vast majority of people who say they are comfortable with higher risk for higher reward are lying. As soon as they have a bad year, they will be blaming you and calling you every name under the sun.
- Thread starter
- #58
Obviously, I can't share my "options strategies" here in a public forum but think of covered calls and S&P dividends which by themselves give around 5% per year. There are ways to enhance that which again I can't share here.
If IULs have no risk of cap reductions and not performing even 5%, then I am all for them.
- 15,041
Two things.
1. If you can't see how your strategy could go bad, you haven't examined it enough. Everything has a risk. The safest thing on the market is a Treasury held to maturity, even then you could lose out if inflation increases and the government could still default.
2. With almost certainty, there is nothing secret or earth shattering about your strategy.
I don't have the time or energy to do active investing, so I have no interest in your strategy.
- Thread starter
- #60
I don't need agents like you who think I have to take higher risk to make higher returns anyway. Thanks so much. Go find some average joe and pitch away
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