Speaking ill of Life Insurance

[bobson]

How can you get money out of a whole life policy tax free? This is a loaded question, because your statement is extremely misleading.

You can take out what you contributed, because you have already paid tax. It's not tax free.

You can take a loan out, without taxes, unless you don't pay it back, then it's taxed when it's no longer a loan.

You can do a withdrawal of the gains, but then, that is taxed.

So tell me, how do I get money out tax-free?

Dan

Either with withdrawls or loans, just like you said. The loan is only taxed if the policy is surrendered.

 

[bobson]

The last free lunch in America is an employer match on a 401(k) and if you aren't smart enough to recognize that, there's no helping you.

Grr... those evil mutual funds are taking all of my premium dollars, everyone should be buying WL instead!!! LOL

Do yourself a favor and don't walk around espousing this kind of ignorance, or most people will see you as the typical insurance agent and dismiss you just as quickly.

But you see, it isn't a free lunch. Eventually you pay the piper. Plus does it matter if you get a "free lunch" if you don't have money in the bank? If you don't have insurance to get you through your disability?

And I am proud to be an insurance agent. Anyone posting on this message forums should announce it from the top of the hills.

 

[bobson]

1. You get a bill each year. Let's face it, a lot of people have trouble putting money in savings because something comes up. You are forced to pay yourself first with life insurance.

And what makes one think they will be compelled to put money into a WL policy?

>>>>The billing statement

2. Tax free is lots better than tax-deferred. You can take money out of your whole life insurance policy tax free. And someday someone will get a whole bunch of money income tax free.


But the return on your money is lousy, debt instruments less expenses.

>>>> Not lousy at all. PUA's are geat!


3. Each year you know exactly how much value your whole life insurance policy has. You never have to hope, pray or guess what the value you will be. It shows up in writing like clock work. And itmay be more than you expect!

It may be, it might not be. Are you suggesting other investments don't give you annual values?

>>>>>Your mutual fund might be gone next year. I know how much cash value I have in my whole life policy in year 30 today. And in fact it will be higher than the gaurenteed value!


4. Policyholders share in the surplus via policy dividends. You aren't making some Oracle of New York rich by paying charges and fees for the privelage of holding your money.

Dividends on WL is a return of overcharge on premiums, that is why they aren't taxed.

>>>>> Yes, you are right.

5. Uncle Sam won't raid your cash value like he plans on when you start taking money out of your 401k and IRA. If you think your tax rate is going down when you retire you are kookie. Social Security, Medicare, and Medicaid will need a giant crutch someday. Tax rates will have to go up, and up, and up.

For a WL policy to come close to alternate investment returns, clients will pay tax on withdrawals over basis.

>>>>>Loans are a beautiful thing! As are income tax free DEATH BENEFITS!

6. Premium continuation for disability via waiver of premium. I guarentee your boss won't keep contributing to your retirement plan if you can't work. The insurance company will.

Point on.

A few quick points I guess.

How long have you been using LEAP?

Looked at it many times over the past 25 years, wanted it to work but could never get complete answers to my questions.[/quote]

Never been to a LEAP class. I just know and love whole life for the average person!

 

[slushhhpuppie]

But you see, it isn't a free lunch. Eventually you pay the piper. Plus does it matter if you get a "free lunch" if you don't have money in the bank? If you don't have insurance to get you through your disability?

And I am proud to be an insurance agent. Anyone posting on this message forums should announce it from the top of the hills.

LMFAO!!!! Like I said, no helping you.

Who pays the piper? Before I became my own boss I banked over $10k JUST THROUGH employer match on my 401(k). Boy, don't I feel like a schmuck.....

Earth to you: NO ONE EVER PLANS ON BECOMING DISABLED. EVERYONE PLANS ON RETIRING.

That is the whole concept..... Plan for certainties, protect against possibilities....

If a client came to you with only enough money to either [A] Contribute to their 401(k) with employer match or Buy a disability policy, which would you recommend?

 

[The Rabbi]

It seems to be wiser to save the money.

 

[djs]

Either with withdrawls or loans, just like you said. The loan is only taxed if the policy is surrendered.

But you said tax free was better than tax deferred. I'll repeat my question, how is this tax free?

If you die with an outstanding loan, the policy is surrendered, and the tax kicks in on the loan proceeds.

You are also taxed if the policy endows and you have a loan (as part of the gain).

 

[NewHealthStrategies]

In Bobson's defense, there will always be those that will listen to the "fringe" and buy into the "little-blue-pill" of permanent life insurance... mostly because they are renegades and simply like the edge.

I will continue to echo the question I have now asked 3 other times in this post: Where is the empirical evidence of your claims backed by at least a "regionally" recognized (I'm not even asking for nationally recognized anymore)... Financial planning guru/expert/advisor, etc. You won't find one. Givens, Orzman, Ramsey, screaming-dude-on-TV....

....... one would think, for just a second, that if this permanent life thing was such a grand "fix" for everything and that even the "little-guy" could buy it and have it work wonders (except for that 4 hour perplexia problem).. that at least SOMEONE that is recognized would adopt the mantra....

But you go ahead and preach the David "Tax-Free" Koresh stuff... I've no longer any beleif that common sense will prevail....in fact, you'll probably make millions and live on a beach having drinks with little umbrellas in them.... you've got to love America..... I know I do!

 

[jeffery_scott76]

Hi, I won't name that giant since I too have a coverage under them..but would like to share something that once happened with my friend's elder brother..
This gentleman had applied for a pension plan (annuity) after going through a long discussion with the agent. As per the explanation of the agent it seemed suitable for the needs of his family.

Now, the annuity was supposed to accumulate a fund after 5 years through which he was supposed to get paid after retirement. But now that, he is no more working, he is astonished to find that the rate of accumulation had dropped considerably & that the insurance co. has to say that such rates are always subject to the company's profits.

Now, you guys tell me..is it worthy of taking a pension plan? Or is it better taking a WL policy?

Regards,
Jeff

 

[NewHealthStrategies]

Now, you guys tell me..is it worthy of taking a pension plan? Or is it better taking a WL policy?

Regards,
Jeff



Isn't this like asking which would you rather have, OBAMA or CLINTON??

How about NEITHER of them.... the brother was listening to bad advice.... but nothing new about that!

 

[xrac]

AT - VFTF - FTC Releases a Study Critical of the Insurance Industry