Dude....look at the skylines of any major city. Those skyscrapers are mostly life insurance company. Even arenas are named after insurance companies.

Better hope she don't get sick and miss a payment.

It only pays out the death benefit. It does not pay out the cash value. Whoever sold you this policy lied. Check your contract with somebody out of the insurance company to explain it to you.

So, let's see how honest you are, Mr. Salesman: What happens to the cash value in a WL policy when the person dies?

@@astroman30 That is called a death benefit, sir. It's not technically the cash value, but whoever is the beneficiary receives sometimes even more money than what the cash value is, and can do virtually whatever they want with the money. Also, it's Misses.

@@FutureFortunesInfinite Yet, you never answered what happens to the cash value.

No, the reason price went up was because there is a higher risk of dying and illness at an older age ins qualify them as RATED. Life Ins its just like phone ins you dont needed forever

Why IULs are garbage (from an actual fiduciary :) 1. Money never enters the market - With an IUL, the money funding the cash value portion of the policy is never actually invested into the market. Instead, the insurer holds your “cash” and pays a return on the annual growth of a specific index. Anyone selling IUL are not required to have a securities lIC. 2. Growth potential is capped - While most policies have a “floor” of 0% which prevents your cash value from dipping below what you put into it, your growth potential is capped, too. For example, if your policy limits growth to 10% on the index and that index out-performs that percentage, you’ll still only receive the value of 10% in your account. The insurer keeps the difference. 3. No dividends - Dividends are completely eliminated in an IUL policy. Not having the chance to reinvest any earned dividends, as you could choose to do with an individual investment, means you could miss out on a great deal of money from dollar-cost averaging over time. 4. Fees, fees and more fees - IUL policies are packed with fees and charges that will eat into any cash value accrued. 5. Rising costs - The internal cost of insurance continues to rise as you age, which can limit the amount of money going toward any potential cash value. All universal life is A.R.T ( annual renewable term) PLUS: Almost all cash value policies have these “features” built in. • You’ll accumulate NOTHING in cash value for the first few years the policy is in force. • The cash value earns a lower rate of return (often just 2%-4%) than the potential return you could achieve if you put your money into a vehicle such as a Roth IRA in the U.S. • If you borrow from the cash value, you’ll pay it back plus interest. • If you die with the policy in force, beneficiaries receive the death benefit (less any outstanding cash value loan balance) while the insurer keeps any accrued cash value. Unless you have the increasing death benefit option (option b) the consumer will pay more for that option. The consumer always gets screwed when investing in these policies. The only winners are the agent and the company. The BS I hear all the time is it has to be "structured properly." I have collected 64 policies in the last year and I haven't I seen one structured properly.

Not if it's max funded, up to the point it would become a MEC. Yeah, money could be invested in the market and maybe save on some term, that increases every time its renewed. Plus, no death coverage past 80. There's zero guarantee that the money put into the market is going to come out with a double-digit gain, say 10% So sharing a cap of 10% with the insurance company is a tradeoff for an absolute guarantee that the policy owner doesn't experience any negative losses, with a minimum floor of 0.75%, from the market. Some might say 0.75% disappointed. But there will never be negative losses from the market, that's the benefit for the average person that doesn't invest heavily in the market on their own. For the fees, yes, they will tend to increase as the policy ages. Any recommendation to a policy owner to pay the minimum premium to keep it in force, yearly, would not be wise. Paying the target premium to keep it in force for its lifetime, might result in the cash value decreasing some. But chances are the policy owner is into the policy for the death benefit anyways, in this scenario. To take advantage of this type of policy and tax advantages, it needs to be treated not like a life insurance policy. Disregard using it primarily as life insurance. Start it off with a lump sum deposit and over pay into it. Long term to allow the compounding to build. Cash value will start building, faster and faster. Later on, don't take loans. Take withdrawals. All of this is considered "safer" that strictly market investing, for the average person. If someone wants pure life protection, then that's term. But paying into term policies and receiving nothing in return if you don't die is kinda a waste. Then for the older people, trying to get term later in life. Term that converts, great for life protection. But for generating tax free amount of money, bigger returns with a safety net. If it's paid into heavy. @@astroman30

@@benjaminfeely2722 Simple question, would you rather have 100k in a ROTH IRA or 100k in Cash Value?

What happens to the Cash Value when the person dies?

@@astroman30 The same thing that happens to your premium payments when you pay off a mortgage. The financial institution keeps the premiums (that went to build equity in the property) and you keep the house. In the case of whole life, the insurance company keeps your premiums (that went to build cash value) and your beneficiaries get the asset you purchased: the death benefit. This actually highlights why home equity is an (inferior) alternative to whole life for cashflow needs. You can borrow against your home equity, but the terms and conditions are worse. First, you require approval from the bank. They may deny you the loan. With a whole life policy loan, the insurance company doesn't ask any questions other than: do you want a check or a direct deposit? The reason for this is that, for the insurance company, your policy loan is a simple math subtraction problem. If you were to die and have an outstanding policy loan, they simply subtract that from the death benefit. On the other hand, the bank may need to be involved in a home foreclosure process if your surviving family members cannot pay for the house and the loan - in some cases the bank wants the loan paid immediately in full. Second, the interest rate on a home equity loan that you get from a bank will most likely be higher than a policy loan interest rate. I just purchased a car in 2023 and the dealer's rates could not match my policy loan rate even though I have over 800 credit score. Third, a home equity loan will require a strict repayment schedule. You will need to pay this back monthly on whatever repayment terms the bank decided. With a policy loan, you can repay as your financial situation dictates. If you really needed, you can even use the dividends that your policy generates to reduce the balance of an outstanding policy loan. I already explained the reason for these excellent terms is that it is much easier for the insurance company to ensure loan repayment in case of death. Obviously, since you are using the policy cash value for cashflow purposes, it is in your best interest to replenish that just as you would replenish an emergency fund in a savings account. Finally, the only place where home equity may have an advantage is asset appreciation. Your house will most likely appreciate better than a whole life policy. A well-structured policy using PUAs will give you approx. 4% growth after 20 years or more. In the short to medium term, houses will most likely appreciate better than that. Obviously, in the long run, the housing market fluctuates, and we can get into a situation like the 2008 crisis at some point. Also, initially, since whole life insurance policies are front-end loaded, your cash value will be lower than your premiums for the first few years. Again, if well-structured policy using PUAs, this will be 80% or more the first year and match your contributions shortly after that. Once people realize that whole life policies are indeed better than home equity for cashflow money, they usually move the goalpost to: why pay interest to borrow from your own money? The answer to that question should be obvious because of the nature of savings accounts. As an additional piece of information, for those interested, the cash value represents the future discounted value of the death benefit. In other words, the cash value is the money that the insurance company is pilling up to pay for your death benefit in the future. If you were to reach age 121 (or whatever the policy lists) the cash value will match the death benefit. At that point, the contract ends and you (not your beneficiaries) get that money.

@@astroman30 The same thing that happens to your payments when you pay off a mortgage. The financial institution keeps the premiums (that went to build equity in the property) and you keep the house. In the case of whole life, the insurance company keeps your premiums (that went to build the cash value) and your beneficiaries get the asset you purchased: the death benefit. In no other context you would expect to keep your payments and the thing you purchased. You don't get to keep the groceries and the money that you paid to get them. You don't get to keep your car insurance payments and the benefit when you get into an accident. This is the silliest critique ever. Also, the cash value is technically owned by insurance company. They need to stash that money to pay for your death benefit in the future. You get access to it in the form of policy loans. People just refer to this cash value as "their" money because cash values are liquid. They don't require approval, the insurance company doesn't ask you what you are going to use the money for. They just ask you: do you want a check or direct deposit? And you know what other context uses this same terminology even though it is not technically correct? Bank accounts! Yes, when you deposit your check into a bank account, technically, the bank owns that money and you are an unsecure creditor to the bank. However, people still refer to the balance in their bank accounts are "their" money. Of course, at this point, people move the goalpost and ask: why would you pay interest to use "your own money"? The answer should be obvious if you know the nature of bank accounts.

@@AncientMarinerNY So, much like my house, you're saying that if I pay off my loans in the Cash Value, I get to keep it?

@@astroman30 I added extra information to my response before I saw you replied. The insurance company owns the cash value. Please read it and inform yourself.

Not if you go with option B

@@Christiankota No option B in a whole life policy.

Womp womp womp😂😂😂 the answer is no, stop being so negative and do some research on the Dunning-Krueger effect

@@jianipierre5040 Womp? You are a 3rd grader? Video is sponsored by NYL. Look it up.

“Dividends” as defined by the IRS pertaining to whole life insurance are nothing more than deliberate front loaded overpayments that you are getting back. A refund. You push this scam because you sell it. Trash value insurance is a bad purchase. Try harder

i am working with mass mutual for a whole life, can you explain more on this to me

You don't have to pay the loan back, but it will be taken out of the death benefit plus all the accumulated interest and fees. Any type of cash value insurance is a scam.

Term insurance can do the same thing at a fraction of the cost compared to trash value insurance. ULs are worse than whole life. The cash value gets eaten up by all the fees/commissions leaving the person to pay out of pocket to cover the A.R.T (annual renewable term.)

It's for your family, not you.

Perfect description

Why is that??

@@Pilot_1kushface it’s a scam. The cash value is kept by the life insurance company

So, how do I get my money out of "storage" without having to borrow, defer or cancel the policy?

Whole life is for stupid people

Buy Term and invest the difference very early in life was actually very popular and economical I the 80's and 90's. Today when you have a 30 year mortgage, there shouldn't be a need after 30 years and the home has been paid off.

You can also take losses being in the S&P. Losses hurt. Especially when close to retirement age. If you're in your 50s and worried about the future of our economy/market, don't take this guy's advice.

How can I message you for advice and tips ??

​@@tmac9938would you not still be better off using money market funds, high yield savings, or literally ANYTHING else ???

@@tmac9938 I'm just learning about all this so I'm still raw on the subject, but I feel as though he just downplayed all of the positive factors of a Whole Life policy by pointing out how each of its individual advantages can be found through various other methods of investing. If anything I think that highlights the policy's diversity in how many features you get all in one policy as opposed to 4 or 5 different investments. To your point, there's still market risk putting your money into an S&P index. With the Whole Life's interest crediting you get a fixed rate of interest GUARANTEED for the policy's life. In addition, yes his term policy may be cheaper now and may have more coverage but what about when that expires? Even if it's renewable his premium will continue to increase as he ages, and once that ultimately expires in his old age getting a new life insurance policy is gonna be expensive and painful. The policy loans and surrender options it offers are just bonuses giving you more financial flexibility. It's definitely fair to say the policy may not be for everyone, and perhaps not for him, but to me it doesn't make sense to write off the policy as a whole. Not to mention we didn't even acknowledge the "for life" aspect where you're guaranteed the death benefit no matter what. Those are just my thoughts on the subject. Again, everybody has their own personalized needs based on a myriad of factors in their lives, but its important to be reasonable in our assessment of the policies and understanding that just because it isn't suitable for you doesn't mean it lacks quality.