emergent_sea
New Poster
Cash: $ 0.45
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Joined: 14 Apr 2005
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| Variable Universal life |
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I have talked to a financial planner who is advising me to start a Variable Universal life policy. He gave me an article from the book "Missed Fortune". I read through that chapter and although it sounds reasonable, there are some red flags that worries me. From everything I have heard, Universal/whole life is a poor option for most people. Can anyone advise me if I should keep him as my advisor or dump him?
I am 31 years old, make 300K a year. On top of this, my company puts in 40k a year into my SEP IRA. I have about 180K in my SEP IRA, 7k in Roth (I can't put anymore in and haven't for awhile), 60K in a day trading fund, and about 20K in my bank accounts. My Wife puts in 13K a year into her 403B and has about 45K in that account. She makes about 50K a year. She has 50K in the bank just earning savings interest (I know this might not be the best thing but its our emergency fund).
After taxes this year, we took home about 200K cash. We have 100K left on our 150K condo. My BMW and Her infinity are paid for and both still have about 40K resale value. We have very little in Student loans left (10K) and no credit card debt. That is all the debt we have.
I suspect We can save about 8K a month but can't predict the future as we have kids and need a bigger house.
The advisor told me I can set up a High cash variable life and only require 4% to upkeep it. I am reading up on this but still alittle confused. He says the money (after tax) that I put in will not be taxed if I take it out. He makes it seem like the monies are very liquid. I can put the money in selected mutual funds.
Is this the best way to plan my future or should I just put money into my day trade account and buy low cost/diversified mutual funds? I don't want to buy and rent property b/c I wont enjoy this. Any other options.
I have an appointment w/ another advisor tomorrow who I am going to run this by. I will then decide who go to with.
Any Help would be appreciated.
Also, I plan on working part time in about 10-15 years (8 days a month) but probably can still pull in 170K a year so I won't have to take from my retirement.
Thanks again
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Thu Apr 14, 2005 6:22 am |
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BlankenshipFP
Money Talk Advisor
Cash: $ 79.56
Posts: 390
Joined: 05 Oct 2004
Location: Illinois
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I would recommend taking your situation to a fee-only financial planner, rather than an insurance agent. You can find fee-only financial planners at www.NAPFA.com (National Association of Personal Financial Advisors) or www.GarrettPlanningNetwork.com (the Garrett Planning Network).
Both of these websites have "Find-a-Planner" functions which will help in your search.
Hope this helps -
Jim Blankenship, CFP®, EA
Blankenship Financial Planning, Ltd.
www.BlankenshipFinancial.com
Standard IRS Circular 230 Notice Applies
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Thu Apr 14, 2005 2:29 pm |
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Rolo
Yo' Daddy
Cash: $ 309.70
Posts: 1551
Joined: 13 Mar 2005
Location: Colorado/Florida
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| Re: Variable Universal life |
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quote:
Originally posted by emergent_sea
Variable Universal life policy
is all I needed to hear. They are rip-offs. The one who recommended it did so for his sake, not yours. Fire him immediately.
"Expect me when you see me."
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Thu Apr 14, 2005 11:19 pm |
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jlee1224
Full Member
Cash: $ 12.65
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Joined: 26 May 2005
Location: Baltimore
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Variable universal or whole life policy for you would be very wrong.
You should definitely take out some form of life insurance (and also for your wife). A term life insurance policy will do you well, as it will not be as expensive and you definitely want to ensure that your children and family will be taken care of if you or your wife pass.
I would fire your advisor.
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Thu May 26, 2005 2:08 pm |
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emergent_sea
New Poster
Cash: $ 0.45
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Joined: 14 Apr 2005
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Why would it be wrong? I have talked to three different advisor (one that doesn't like it but said it would work out for me if I do it for 10 years and don't touch it)
I have done the math, used average projections and I am ahead of the game after 10 years.
Can you tell me why its so wrong for me?
THanks
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Thu May 26, 2005 4:50 pm |
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BlankenshipFP
Money Talk Advisor
Cash: $ 79.56
Posts: 390
Joined: 05 Oct 2004
Location: Illinois
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Were the three "advisors" affiliated with insurance companies? I think this might be a clue as to the answer to your question, if so.
Jim Blankenship, CFP®, EA
Blankenship Financial Planning, Ltd.
www.BlankenshipFinancial.com
Standard IRS Circular 230 Notice Applies
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Mon May 30, 2005 7:54 pm |
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