Personall, I like traditional Whole life from a mutual company a lot more.

So if the index is negative for the year, your cash value would have 0% growth for that year, but you still have to pay fees so your CV will fall slightly. The fees and cost of the policy is not shown on the policy and will come out of the account after. SO say the index returns 13% in one year, you might only get 7-8% growth in your cash value.Īlso, read the fine print of the illustration. Likewise, the money invested will have a cap. Your principle is protected, so the cash value you already accumilated will not be subject to market downturns. The cash value is invested within the company's general fund to reflect whatever index. They often have to use a lot of the cash value on their premiums or they often have to reduce the amount of coverage to lower the premiums. A lot of people get IUL and get older and have to pay more in premiums because they are much older. Basically it's term that renews every year and the cost of the insurance reflects your age every year. IUL is basically a yearly renewable term product that also has a cash value account. I would avoid IUL and look at traditional WL with a mutual company instead. Cash value life insurance of any sort has admittedly always made me a bit skeptical. I'm also concerned about signing up for something that will take so long to fund in the event we hit a major life changing event (loss of job, pandemic, etc.). I don't see it.so what am I missing? Or are they looking for a sale? I understand that it's safe in a sense that you shouldn't lose money if the market is down, and you do make money if the market is up. The payments would be something like $600/month for 10 years for both of us to fully fund. I understand that these plans include long-term care, but they are pushing it as a viable investment vehicle that will assist with our taxable income at retirement age. Neither my wife nor I are planning on leaving behind a substantial amount of money for our children (beyond what will cover our estates). We are both currently funding 30-year term policies. We have two young children and we have opened and began to fund UTMA accounts on their behalf.Īfter discussing goals and risk tolerance, the firm continues to push us towards purchasing an Indexed Universal Life plan from Pacific Life. We have a sufficient emergency account and have always adequately invested in our 401k and 403b. We finally got some debt paid off and hired an all-encompassing (tax advisement, trust planning, investing, estate planning, etc.) financial advising firm last year. My wife (34F) and and I (35M) are both on the lower spectrum of being high-income earners.

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