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.
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.
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.
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A.M. Hyers
Hyers and Associates, Inc.
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.
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.
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.
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.
Geez, you are a linguist! How about a translation in English!
BTW can you do Hebrew, too?
Geez, you are a linguist! How about a translation in English!
BTW can you do Hebrew, too?
בעת רכישת ביטוח חיים אתה רואה את זה בתור השקעה טובה? לדעתי, כמו פוליסת ביטוח החיים שלי, החלטתי לקנות את זה בעיקר כדי לאבטח את המשפחה שלי בעתיד כאשר דברים לא רצויים לקרות לי. ואז בצד השני, זה נותן היבט כלשהו של השקעה כי אני יכול לנצל ערך המזומנים שלה כמו פעם בא יכול להשתמש להשקיע סכום כזה.
I agree that should not be its primary purpose. Investment elements of permanent life insurance enhance its value. They make it more suitable for those who would otherwise buy term and waste the difference.
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I thought this WAS a real job!
Life Insurance- Systematic tax deferred/free savings vehicle.
I wonder if you ask a bank why they own BOLI (Bank owned life insurance) or a corporation why they own COLI, I wonder how they view the cash value. An Inevitable gain is better than an investment.
"Life Insurance is protection only, not an investment...this could be miss leading information if I was a client of yours.
Elliott"
Elliott, if you only show your client one option, you will not have that client very long because someone else will show your client all their options without bias and take your business away.
"Misleading" someone is attempting to prove there is only one method of use for life insurance.
"Life Insurance is protection only, not an investment...this could be miss leading information if I was a client of yours.
Elliott"
Elliott, if you only show your client one option, you will not have that client very long because someone else will show your client all their options without bias and take your business away.
"Misleading" someone is attempting to prove there is only one method of use for life insurance.
[COLOR=black]1) To LGilmore - I couldn't agree more.
2) To Elliott - As a life insurance professional, it is your duty to fulfill your fiduciary obligations to your client. Thus, discussions about life settlements and other exit strategies should be part of your mantra... and hey, if you can’t change the fact that you are full of greed, you can still make money while doing the right thing. Try to be a little more open-minded… I would suggest learning about all the options life insurance can offer your clients; then, you can make lots of money, do what’s right for your clients, and everyone wins![/COLOR]
GFN, thanks for that post in Hebrew. I can speak many languages with the exception of Greek. Actually, they are all Greek to me (including Hebrew) with the exception of English!
If you are going to present, or even talk about life insurance as an investment, calculate the ROI using the premium and death benefit, not cash or surrender value. There is no way anyone anywhere can achieve that kind of return on a tax free basis.
Re: Life Insurance = Good Investment
Re: Life Insurance = Good Investment
Try to be a little more open-minded… I would suggest learning about all the options life insurance can offer your clients; then, you can make lots of money, do what’s right for your clients, and everyone wins![/COLOR]
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