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Dmy0013

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« on: February 11, 2013, 07:39:14 PM »
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« Last Edit: April 13, 2016, 09:37:38 AM by Dmy0013 »

MooreBonds

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Re: IRP - Insured Retirement plan
« Reply #1 on: February 11, 2013, 09:12:18 PM »
The part that is overlooked is the cost of the loan that you later take out, along with the cost of insurance and commissions that are deducted from your payments.

Oh, and not to mention the fact that many mutual funds offered inside of a life insurance policy have high expense ratios.

It's true that your additional contributions can grow without having to pay income taxes on the returns....but when you combine up the three expenses mentioned above, I just don't see how that beats a low cost mutual fund.


mjirmen

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Re: IRP - Insured Retirement plan
« Reply #2 on: February 20, 2013, 03:22:02 PM »
This is actually a great concept to use and I happen to teach it and use it myself. However, with that being said there are several factors to take into consideration.
1. Universal, Variable or Indexed Equity do not work for this concept. Only Dividend paying whole life!
2. the policy is setup for the purpose of doing this! It does not work like you are being told with a regular whole life policy that would be setup for death benefit.

If you care for more deatails I would be happy to share. I am not sure of your extent of knowledge as I could go on forever. :) Done correctly this is an amazing product!

Hope that helps,

Mary Jo

arebelspy

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Re: IRP - Insured Retirement plan
« Reply #3 on: February 20, 2013, 03:34:04 PM »
Please please please do not mix investing and insurance.

It is a bad idea for everyone except the person getting the commission.

If you want life insurance, get term life insurance.

We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
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mjirmen

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Re: IRP - Insured Retirement plan
« Reply #4 on: February 20, 2013, 06:47:55 PM »
It is as bad idea to mix them, insurance is NOT an investment. Anyone who says it is does not know what they can do with an insurance policy.

Those who do not know this process and have not studied it in great length do not understand how powerful it can be for the insured. Do not short suit yourself and make a decision based on what the "traditional" system is trying to tell you. Be sure to look into this yourself, run your own numbers and make your own decision.

Commissions are not an issue when you set the policy up for banking purposes. When you buy strickly life insurance for death benefit yes commissions are high. Please do ask your financial advisor how much they are receiving in fees and commissions for managing your money. Also, please do not forget to ask them if they are getting fees and commission when you lose money.

And finally, you did not ask about death benefit....term is death benefit only. It is not even a subject when talking about using the money in a policy.
 :)

arebelspy

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Re: IRP - Insured Retirement plan
« Reply #5 on: February 20, 2013, 07:48:23 PM »
term is death benefit only.

Exactly. 

If you want life insurance, get term.

Otherwise, don't get any.

Definitely keep your investments separate from insurance products.
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
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mjirmen

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Re: IRP - Insured Retirement plan
« Reply #6 on: February 21, 2013, 07:52:34 AM »
Con't get any is a pretty harsh statement if one does not understand how this process works.

Wanting to use the life insurance as a tool for financing everything you buy along with the bonus of the death benefit is an amazing concept when used correctly. A concept people should be willing to explore and look into. I commend those that do and the person that asked the question! Good for them for looking at other options.

If you want to throw away your money get term.

The person here is asking for facts on the situation. Fact is you CAN use it for financing and borrowing against as well as supplementing retirement tax free. Does it work in all policies like he asked, NO.

MJ

arebelspy

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Re: IRP - Insured Retirement plan
« Reply #7 on: February 21, 2013, 08:25:33 AM »
Wanting to use the life insurance as a tool for financing everything you buy along with the bonus of the death benefit is an amazing concept when used correctly.

Completely disagree.

Use your investments for financing everything you buy.  If you want a death benefit, get term life insurance.  Keep investments and insurance separate.

A concept people should be willing to explore and look into.

..and then disregard.  People that get into "investments" like this do so because of lack of knowledge. They're buying from a salesman without understanding what they're getting into.  If they had explored more, they wouldn't have done it almost every time, IMO.

If you want to throw away your money get term.

That's like saying "if you want to throw away your money, rent instead of own" - it completely depends on the circumstance.  But if you don't need a death benefit, then you don't need life insurance, and you're throwing your money away buying some.  If you do need a death benefit, buy term.  You aren't throwing money away, you're getting exactly what you want - insurance against dying.  That's like saying having car insurance is "throwing your money away" - no, it's paying for insurance against the catestrophic.  If you don't need that, don't get insurance.  If you do, get it.  But don't then try and mix in investments into the same vehicle and get subpar performance and much higher fees.


/going in circles with an insurance salesman whose whole contribution to this forum is three posts vaguely arguing why people should have "dividend paying whole life" insurance
//not sure why i bother
///hopefully anyone reading this post will have gotten the idea by now, and not be hooked in by a sales line
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

mjirmen

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Re: IRP - Insured Retirement plan
« Reply #8 on: February 21, 2013, 01:41:40 PM »
Yes I have three posts because a friend introduced me to the website and I seen this post right away. Will I be looking at other posts on this website? I sure will.

Funny you said say renting vs buying. You are "renting" money froma  life insurance company should you die before you are 65. haha. I would rather not rent my life insurance.

It is fairly clear you are not willing to look at all avenues and have not truly looked into the concept of using life insurance but are willing to give out your opinion regarding it w/o having the facts. That is truly sad and unfair for all those who are reading this. Allow people to make their own judgements on how they are to manage their money.

I would like to know how this can be done: "Use your investments for financing everything you buy."

Also, inside your investment:
Is there guaranteed compounding growth?
Is there tax free benefits outside of a Roth IRA? 401k for example.
Is there liquidity of money?
Is there penalty free early use of money (withdrawal)?

And I hope those reading this post are inclined enough to look into learning more and not discrediting it to someone who does not know how it truly works. (assuming you have not read the books out there on the subject, studied with the man who wrote about the concept and visited hours with insurance companies)

Spork

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Re: IRP - Insured Retirement plan
« Reply #9 on: February 21, 2013, 02:35:09 PM »
Please please please do not mix investing and insurance.

It is a bad idea for everyone except the person getting the commission.

If you want life insurance, get term life insurance.

I'm going to side with you on this.  But I'd add one more bullet item:
Be suspicious of complicated investments.  Almost always: simple is better.  That's not to say they won't work.  But you'd better damn well understand them.  If it's written by a lawyer and you're not a lawyer, be advised to have a disinterested 3rd party with financial/legal experience to fully explain it to you.

arebelspy

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Re: IRP - Insured Retirement plan
« Reply #10 on: February 21, 2013, 02:35:42 PM »
You are wrong, and make incorrect assumptions.

I have studied it extensively.

Any time someone promises such wild claims (guaranteed compounding growth, tax free benefits, liquidity of money, penalty free early use of money) one should automatically raise an eyebrow and research more.

What exactly do you give up to get that "guaranteed" compounding growth?  I don't want a cap on growth, for example.  I don't want to pay exorbitant fees.  A typical expense ratio on my investments is about 1/4 of 1%.  What is it on yours?

These are but a few examples of why these investments are sub-par.

In any case, there is probably no need to argue this further, it's clear we both have very different opinions.

I encourage anyone looking into insurance as an investment strategy to scrutinize it very, very carefully and make sure you completely understand it before you invest a dime.
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

jp

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Re: IRP - Insured Retirement plan
« Reply #11 on: February 21, 2013, 02:43:11 PM »
I am just going to leave this here: 

http://www.smartmoney.com/plan/insurance/term-or-whole-life-8011/


Quote from: smart money
The right type of life insurance can be summed up in a single word: term.

cmon guy.  no one here is buying what you are selling...

mjirmen

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Re: IRP - Insured Retirement plan
« Reply #12 on: February 21, 2013, 06:01:45 PM »
Thank you for posting the link:

Couple of things to point out.
1. I am not a guy....
2. the article reads: The three most common types of whole life insurance are traditional whole life policies, universal and variable
   - correction - they throwing ALL permenant life into one category called whole life. These policies are NOT made equally. UL and VUL are terrible vehicles.
3. article also reads: Most policies don't start to build decent a cash value until their 12th or 15th year.
  - correct, most do not because they are setup for death benefit and not cash value. When a policy is setup for the use of financing the CV will be to where you break even at year 7-8. That is a policy working for the insured.

I am not going to go further into detail on this article. If people on this forum on interested in more detail they can google the information and find lots of positive and negative to make their informed decisions.

It is clear that one who reads the article attached is NOT informed about life insurance and how one can make it work for financing purchases.

And finally, I am NOT selling anything on this site but sharing correct information taught to me. Information that I have gotten from many hours of studying and devoting time to making sure this is an accurate concept. When introduced to it myself I did not believe it, did my due diligence and found it to be true - when done CORRECTLY.

I have not nor will request business from this site. I figured forums are to educate and inform....I am not here to "fight" with you boys. I am here to share correct information since so many are incorrectly informed or uninformed. (and thank goodness I am not selling since I seem to be terrible at it ;) )

I will be happy to share some videos with you boys when I get them completed. :)

MJ

arebelspy

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Re: IRP - Insured Retirement plan
« Reply #13 on: February 21, 2013, 06:48:36 PM »
Thanks for your input MJ.  Best of luck to you.
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.