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But Whole Life Insurance Has Really High Commissions

Recently I've noticed that whole life insurance is generally berated by almost everyone in the known universe. Well, most insurance agents really like it but other than that it’s pretty easy to count the number of folks who really like whole life insurance.

Obviously, we consider it to be an excellent component to an overall investment strategy, and as such I thought it would be useful to elaborate on a few of the applications that whole life insurance can bring to the table. (this could also apply to other types of permanent insurance as well) And I know I'll get beat up for just mentioning the word investment and life insurance in the same sentence. But considering a properly structured cash value life insurance policy as a portion of your retirement savings, emergency fund, or your kid(s) college fund is a solid plan. We can and continue to prove it everyday in our practice.

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036 There’s a Mutual Fund for That

by Brantley Whitley

Podcast: Play in new window | Download

(Complete Show Notes Below)

In the 36th episode of the Financial Procast:

We Answer Questions from Our Listeners

Instead of the normal podcast where we'd discuss a myriad of topics from the financial world, we've decided to break the mold a bit and devote an entire episode to answering questions we've received from our listeners/readers. We get questions emailed to us all the time and from time-to-time it makes sense for us to go through and answer some of them live in our podcast so that our entire community can benefit from the discussion.

Here is a transcript of the questions:

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Death During the Life Insurance Contestability Period, now what?

by Brandon Roberts

Life insurance brings a lot of mind comforting notions with it. It helps many people sleep soundly at night knowing that they need not worry about what happens to their family or loved ones if they should meet an untimely demise. But what happens if you recently put your coverage in place and you don’t live beyond the life insurance contestability period?

Do you need to worry about the insurance company’s not paying the claim to your beneficiary? What if you fibbed a little bit about how great your health was? Or what if you find out not long afterwards that you weren’t quite as healthy as you thought you were?

Can the insurance company use any of that against you to deny the claim?

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Are Mutual Life Insurance Companies Better than Public Life Insurance Companies?

by Brandon Roberts

Maybe you’ve heard this one before, the claim that mutual life insurance companies are better than public life insurers. Of course, the mutual life insurers all think so. But we’re willing to bet that the so-called public life insurers would tell you differently.

So is it true that the non-mutual life insurers are just out to swindle everyone out of their money and represent all that is wrong with American capitalism? Or are the mutual just stodgy companies that have a problem embracing modernity…and the capital markets. 😉

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035 If You Turn to Page 15,099

by Brantley Whitley

Podcast: Play in new window | Download

(Complete Show Notes Below)

In the 35th episode of the Financial Procast:

We Discuss the PBS Frontline Special “The Retirement Gamble”

If you haven't seen this short special/documentary, here's a short preview and a link below the preview that will take you directly to the Frontline page on the PBS website where you can watch the epidsode in its entirety–don't worry it's less than an hour long and it's worth your time.

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Participating Whole Life Insurance Income Comparison

by Brandon Roberts

Participating whole life insurance is a form of cash value life insurance that is often used with a focus on its cash accumulation capabilities and retirement income generating prospects.

In fact, we’d argue quite forcefully that if one wishes to use whole life insurance as an asset, participating is a key attribute to any chosen policy. And every time we reference whole life insurance for this purpose, we assume by default that the policy is a participating policy.

What does participating mean?

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034 It’s Good to be a Judge

by Brantley Whitley

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(Complete Show Notes Below)

In the 34th episode of the Financial Procast:

Private Equity Found a Shiny New Investment Strategy

Yes it appears that some players in private equity have taken quite a shine to life insurers. In the last few years Goldman Sachs, Harbinger and the Apollo Group have purchased U.S. based life insurance companies. Why the interest in these otherwise boring companies you might ask? Well, mainly because insurance companies sit atop piles o' cash…think Richie Rich or Scrooge McDuck.

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Be careful how you save—Your IRA and 401k may be a trap

by Brantley Whitley

Since I’m never really one to go with the flow, today I’ll hold true and bludgeon the sacred cow of all financial advice gurus—the IRA and the 401k. It’s not that I’m trying to be controversial or contrary to spite Dave and Suze.

That’s just an added bonus.

I am concerned about the conventional wisdom that says the IRA (both traditional and Roth) and the 401k are the best ways to save for retirement. In fact, these sorts of qualified plans could trap you and really put a squeeze on your retirement plans.

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033 WARNING: You Are Now Leaving the FDIC Zone

by Brantley Whitley

Podcast: Play in new window | Download

(Complete Show Notes Below)

In the 33rd episode of the Financial Procast:

Could IRA Caps Be a Boom for the Life Insurance Industry?

According to recent reports there is a policy initiative being floated by the Obama administration to limit the amount of money anyone can defer from taxes within their IRA. Yeah, that's right…POTUS is slaughtering sacred cows left and right. What will the modern financial planning community do without the bastion of tax-deferral?

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The Rule of 72 Example

by Brandon Roberts

I know what most of you are probably thinking: the rule of 72? Have the Insurance Pro Blog guys run out of ideas for post topics? Or busy week? Maybe they didn’t have time to come up with something more creative than a boring post about a finance topic known the world over.

For those who don’t know the rule of 72 is a simple rule of thumb used to determine the amount of time an investment will take to double given a certain interest rate. You simple divide 72 by the given interest rate and boom you have the number of years it will take the investment to double.

Simple enough, and no real need to labor this issue any further. So, happy Monday and we’ll be back to you on Wednesday when the next episode of the Financial Pro Cast goes live.

Unless of course, the Rule of 72 is wrong…

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