Reputable? Whole Life with Northwestern Mutual...

Discussion in 'Life Insurance Forum' started by mx_599, Nov 13, 2009.

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  1. bluemarlin08
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    bluemarlin08 Well-Known Member

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    Remember one thing, if you are basing your options on illustrations of projected future performance, I guarantee you will be disappointed. Illustrations prove one thing and one thing only, paper takes ink.
     
  2. LGilmore
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    LGilmore Well-Known Member

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    "The first couple of years have almost ZERO return"

    DHK, yup. But for some reason you didn't mention what happens down the road on a whole life policy.

    I just had my 20th year notice from one of my policies. I paid around $1100 in premium for the year and the guaranteed value and dividend bump for the year was around $2300. So what was my return that year? ;) so, not too bad. For the "RISK" this money is subjected to, I get a reasonable return.

    Dividends aren't guaranteed because they can vary up or down over time.

    BUT COME ON FELLAS, QUIT ACTING LIKE THEY'RE "IFFY".. The companies that use dividends have been paying them for how long? I know mine is up in that 150-160 year range. Basically the year after they opened. They paid dividends through the great drepression. They helped keep many businesses open during bad times. It's a diservice to our industry to imply something that is extremely unlikely to occur.

    Don't complain about a mutual agent selling an illustration number while at the same time implying because dividends aren't guaranteed they shouldn't be counted on. That's just as bad. All you're doing is pissing in the well of somebody else's client, that you won't get.

    Again to the poster of this question... talk to your agent, give him a chance to answer some of these questions you have. Take what everybody here says with a bit of caution, yes, including me. All I know is I would want my client to talk to me about any questions they have. I would do my best to answer those questions.
     
  3. mx_599
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    mx_599 Well-Known Member

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    i was under the impression, and thought i have been told, that over funded whole life offered a high degree of asset protection in cases of malpractice and divorce??

    no? :skeptical:

    mx
     
  4. briko3
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    briko3 Well-Known Member

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    OK, dividends might not be "iffy", but the amount of them is. Companies can get away paying pennies just to say "we're still paying dividends". As far as the protection from lawsuits, you're correct, but that's not what you originally asked. Basically, it does protect you, but you won't see a 6% return in your cash value (as stated above).

    Good luck with what you decide...NWML is a good company and you will do fine with the policy you're talking about. Just don't expect the 6% growth.
     
  5. dgoldenz
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    dgoldenz Moderator Moderator

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    If your goal is to protect assets only, I would recommend speaking with an estate planning attorney that is familiar with your state's laws. Some states have protections for cash value in life insurance policies, some don't. Some states have a limit on that exemption, some don't.

    An irrevocable life insurance trust (ILIT) can be set up to protect the assets from the claims of creditors/lawsuits/divorce, but you can't just take money out of the trust at your discretion. Consider an ILIT as setting things in stone. A whole life policy is not needed to use an ILIT.

    The question would be what is the purpose of the policy for you? Death protection, shielding assets, or both? What is the specific reason for wanting to overfund a whole life policy? What state are you in?
     
    Last edited: Nov 13, 2009
  6. BNTRS
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    BNTRS Well-Known Member

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    Why can't he get 6%? The IRR can reach 6% especially if he's over funding. The IRR on the PUA's can be even better.
     
  7. mx_599
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    mx_599 Well-Known Member

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    wow, where do i start? first let me thank all of you for your time and welcoming a naive, non-professional to your forum place.

    i will discuss this with my agent. i would appreciate anymore comments if you guys want. i will probably print this out so i do not forget what i need to discuss.

    my very brief situation if it would help any of you (my agent knows this info as well):

    1) 32 yr old white male in excellent health, non smoker etc

    2) resident physician of lower paying specialty

    3) in about 3 yrs (35 yrs age) i think i will have 50-100k of investment/savings per yr depending on how i live

    4) single, no kids...no one needs this life insurance money if i die. my motives were elsewhere. i do not anticipate this changing anytime soon

    5) would like to be in position to retire at 50 if at all possible

    6) i was under impression that whole life can offer incredible asset protection in cases of med malpractice and divorce?

    7) for the next 3 yrs, i am very limited on how much i can put in...maybe 200 to 600 a month depending on moonlighting etc. 200 initially is what we were starting with. i believe my agent set it so i could put up 10k a year.

    nothing is finalized yet. i am glad i received all of your inputs before i did. i know none of you are my agent, but any bones you want to throw my way is much appreciated.

    again, most of all, thanks for your time. believe me, i know forums can be addicting and time consuming.

    one of my greatest concerns now is this Direct vs Non-direct recognition.

    this definitely was not mentioned. with regard to the percent interest...i am pretty sure what my agent said coincided with what you guys mentioned as cautionary. i dont believe he was misleading me in that sense.

    this is difficult because it seems so complicated to me...

    mx
     
  8. BNTRS
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    BNTRS Well-Known Member

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    WHAT?!

    Why on earth would I want an ILIT for divorce or malpractice protection? What would be the point?
     
  9. mx_599
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    mx_599 Well-Known Member

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    is it at all possible to predict growth? are we talking maybe 3-4%?

    i think he figured after about 10 yrs it would be self sufficient where i would not need to pay premiums because the dividends would cover it? does this sound right? and after about 20 i wouldn't take a loss if i took the money out? or maybe that was 10?? sorry, i do not have this stuff in front of me and its been about 50 days plus it was confusing then and more so now!!

    mx
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    ahhhh, okay.

    well, the state thing is a mess. i mean i will be in one state for residency and who knows after. i might bounce around doing locum tenens for 2-5 yrs...even possibly international for one of them.

    so the state is a messed up situatuion i am unsure of at this moment.

    yeah, all asset shielding. i wasn't really into it for the death benefit. my agent knows this too.

    i am in PA now and will be in SD for the next 2 yrs

    mx
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    yeah, see...i kind of thought my agent was saying this. wow, confusing

    mx
     
    Last edited: Nov 13, 2009
  10. dgoldenz
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    dgoldenz Moderator Moderator

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    If you are sued for malpractice and go bankrupt or die, they have a claim against your estate. If his state does not protect the cash value in his policy outside a trust, they would have a claim on the cash value. A revocable trust in his state may or may not have any asset protection as well. Is that the best way to shield assets form malpractice and divorce? I dont know, I'm not an estate planning attorney, we're talking about life insurance.

    If the person is unmarried, as in this case, an ILIT set up may or may not avoid being subject to a future divorce decree - that would again depend on state laws. The issue is that right now there really isn't anyone in particular that the money is left to in the event of death (as far as I can tell anyway) and setting up an ILIT at this point would probably not be the best move. That's why I said for him to talk to an estate planning attorney.
     
    Last edited: Nov 13, 2009

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