Author Topic: LIRP  (Read 910 times)

saijoe

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LIRP
« on: May 18, 2019, 02:28:09 PM »
Any insurance people out there?  Went to our advisor today and he was recommending a Life Insurance Retirement Plan (LIRP).  My shields went up when I heard life insurance and investing being used in the same conversation.  But, the wife and I are light on life insurance.  I have $75K term through veterans group life and my wife has a one year salary policy through work. 

Our situation:
Me: 54, pretired and making around $10K doing this and that
Wife: 54, working and making just over $100K
NW: $1.5M with no debt

Our worry, we'll get a medical situation that will eat us up.  Or, Long Term Care.  Long Term Care Insurance seems to be a thing of the past and this LIRP was our advisor's answer as a way to pay for LTC.

Financial.Velociraptor

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Re: LIRP
« Reply #1 on: May 18, 2019, 03:09:32 PM »
Don't have enough information.  Most likely, this is some flavor of a "770" plan.  Enormously useful if you need to shield income from the estate tax but otherwise a very high fee product that excels neither as insurance nor investment.  You can probably buy term and invest the difference more efficiently.  Haven't looked into long term care.  It is sometimes offered through work plans and you are grandfathered in once you have it.  Spouse should check with HR.

At a minimum, I'd shop around.

Bucs4Ever

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Re: LIRP
« Reply #2 on: May 19, 2019, 03:18:12 PM »
Any insurance people out there?  Went to our advisor today and he was recommending a Life Insurance Retirement Plan (LIRP).  My shields went up when I heard life insurance and investing being used in the same conversation.  But, the wife and I are light on life insurance.  I have $75K term through veterans group life and my wife has a one year salary policy through work. 

Our situation:
Me: 54, pretired and making around $10K doing this and that
Wife: 54, working and making just over $100K
NW: $1.5M with no debt

Our worry, we'll get a medical situation that will eat us up.  Or, Long Term Care.  Long Term Care Insurance seems to be a thing of the past and this LIRP was our advisor's answer as a way to pay for LTC.


R.U.N. A.W.A.Y.

Your instincts were correct. Anyone who recommends a LIRP either does not understand how they actually work OR is just a salesman looking for a HUGE commission.

Ask him to give you an illustration showing ONLY the guaranteed values. You'll be shocked. The policy will probably lapse when you reach your 70's and then you'd have NO death benefit and NO long-term care benefits. If he says there is no such thing as an illustration with only guaranteed values, then RUN AWAY EVEN FASTER.

Life insurance is the least efficient way to protect your assets from long-term care expenses.

You're the ideal demographic for a long-term care partnership policy (assuming you live in one of the 40 states that have a good long-term care partnership program).

Google the name of your state followed by the phrase "long-term care partnership program" to learn more.


« Last Edit: May 19, 2019, 07:44:59 PM by Bucs4Ever »