Re: Life Insurance = Good Investment

LGilmore

Guru
1000 Post Club
Investment is general term, it can be many things, all subject to different levels of "risk".

I use my life policy as my saftey net in combination with investments, collectables, real estate for example. Each "investment" has a certain level of risk involved.

My investments in equities tend to be much higher in risk, with a hopeful possible greater return. Some years this is the case, some years it's not.

What we have invested in collectables first and foremost are because we enjoy the items. The value has risen considerably over time, but is subject to the whims of someone else deciding a certain depression era item is of value.

My real estate is a combination of residence and property. The residence has both increased in value and decreased in the last few years, but is still worth more than purchase price. My property is a funny thing as it has not improved in value much in the 30 years I've owned it but, in the past 5 years Microsoft and Yahoo have built mulitple football field sized internet processor/storage operations within 15 miles of the land. Growth (housing/ business developement) is creeping closer and closer. In a couple more years, possibly this chunk of eastern washington land will be my best investment as I can either develop housing or sell to a developer.

My life insurance fits in this model as my most consistent, secure choice. The risk I take on with my cash value policy is minimal, and the return reflects that. Any comperable investment "loss" by choosing this method of insurance is reduced by it's other benefits that owning the policy provides.

Is whole life a good investment? Yes. and No. It all depends on what your comparing it to and the risk you're willing to take on. It is entirely an individuals perspective and subject to their feelings about risk.

Clear as mud, no?
 
Life Insurance = Good Investment

When buying a life insurance do you see it as a good investment? In my opinion, like in my own life insurance policy, I decided to buy it primarily to secure my family in the future when the unwanted things happen to me. Then on the other side , it gives some aspect of an investment because I can take advantage of its cash value as time comes and can use such amount to invest.
 
You just said it...you can later use that money to invest. Hence, it is not an investment. Now, in rare cases, a policy can be set up for VERY wealthy people so that it comes close to mimicing a Roth IRA as far as being tax deferred, but that's another situation altogether.
 
Calling life insurance an "investment" is prohibited by NAIC Model Advertising Code, and all state insurance codes. A similar concept is the prohibition against calling premium a "deposit". Insurance code is written this way to firewall insurance products from investment and banking products. Doing otherwise could cost you your license.

atlantainsguy
 
Depends on your definition of investment, but it certainly should not be sold that way. However, 100k single premium in a whole life policy looks a lot better than a 100k in the market over the last decade.
 
"Depends on your definition of investment"

I think that's the key.

Re your last post...one of the guys in my office that I have lunch with every day is a big believer in WL coverage. He has about 4-5 policies on himself...all more than 12 years old. I'm the typical "buy term and plow the rest into 401K, Roth, 529 etc..."

Needless to say, his dividends and increases in guaranteed cash value look pretty good right now.
 
When buying a life insurance do you see it as a good investment? In my opinion, like in my own life insurance policy, I decided to buy it primarily to secure my family in the future when the unwanted things happen to me. Then on the other side , it gives some aspect of an investment because I can take advantage of its cash value as time comes and can use such amount to invest.


Hindi:

जब एक जीवन बीमा खरीद आप एक अच्छा निवेश के रूप में इसे देख कर? मेरी राय में, अपने ही जीवन बीमा पॉलिसी में पसंद है, मैं इसे मुख्य रूप से खरीदने के लिए भविष्य में अपने परिवार के सुरक्षित जब अवांछित बातें मेरे होने का फैसला किया. तो दूसरी ओर, यह एक निवेश के कुछ पहलू है क्योंकि मैं अपनी नकद मूल्य का लाभ ले सकते हैं देता है के रूप में समय आता है और ऐसे निवेश राशि का उपयोग कर सकते हैं


Filipino:

Kapag bibili ng seguro sa buhay mo makita ito bilang isang magandang investment? Sa aking opinyon, tulad ng sa aking sariling mga patakaran sa seguro sa buhay, ako ay nagpasya na bilhin ito lalo na sa mga secure na ang aking pamilya sa hinaharap kung kailan ang mga bagay na hindi gustong mangyari sa akin. At sa iba pang mga bahagi, ito ay nagbibigay ng ilang aspeto ng isang investment dahil ang maaari kong mapakinabangan ng kanyang cash na halaga ng oras ay dumating at maaaring gamitin ang nasabing halaga upang mamuhunan.


Chinese (simplified):

当购买人寿保险,你看到一个很好的投资吗?在我看来,就像我自己的寿险保单,我决定买它主要是为了确保将来我的家人不想要的东西时,发生在我身上。然后在另一边,它使一些投资方面,因为我可以利用其现金价值的优势,届时可以利用这些款项进行投资。


Vietnamese:

Khi mua một bảo hiểm nhân thọ nào bạn thấy nó như là một đầu tư tốt? Theo tôi, như trong bảo hiểm chính sách của chính cuộc sống của tôi, tôi quyết định mua nó chủ yếu để bảo đảm gia đình tôi trong tương lai khi những điều không mong muốn xảy ra với tôi. Sau đó, ở phía bên kia, nó cho phép một số khía cạnh của đầu tư vì tôi có thể tận dụng giá trị tiền mặt của nó như là thời gian đến và có thể sử dụng số tiền đó để đầu tư.


Portugese:

Ao comprar um seguro de vida que você vê-lo como um bom investimento? Na minha opinião, como na minha própria política de seguro de vida, eu decidi comprá-lo principalmente para proteger a minha família no futuro, quando as coisas não desejadas acontecer comigo. Então, no outro lado, dá algum aspecto de um investimento, porque eu posso tirar partido do seu valor em dinheiro como o tempo vem e pode usar esse montante para investir.
 
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