An RIA-Friendly Life Insurance Strategy for Retirement Security (Part One)
February 26, 2024 by David Macchia
Some life insurance marketing sickens me.
Recently, I suffered through 53-minutes of blather before the speaker revealed that what he had been hyping was life insurance. Overly hyped life insurance presentations receive a level of attention from consumers they do not deserve. This is especially hurtful to me because I love life insurance and appreciate its unique value. I am the inventor (1987) of the concept of using income-tax-free policy loans to boost retirement security.
Click HERE to read the full story
Wink’s Moore on the Market: I know how it feels to see your ideation bastardized David Macchia.
I, too, am disappointed at how loans are being marketed on indexed life.
Yes, indeed, we are entrenched in the IUL “spreadsheet wars.”
And while the comparison to the underfunded UL problem is salient, I would suggest that the potential for underfunded IUL is greater.
With the underfunded ULs, we saw a 9% spread between “illustrated” and “actualized” (illustrations showed 13% interest crediting, but the interest rate was dropped to the minimum rate of 4%).
With an underfunded IUL, we could have as much as a 10% spread between “illustrated” and “actualized,” but the situation is worse when you compare the “illustrated” versus “actualized” loan rate as well.
SN: I enjoyed the discussion of how to preserve the insured’s cost basis via a life-to-annuity 1035. Brilliant!
P.S. Eagerly awaiting Part II of this series! -sjm
