Do You Understand the Power of Whole Life Insurance? | Personal Finance & Lifestyle | Yakezie Forums

It's a pretty interesting product with some potentially nice features, but it was really hard for me to understand. The issue I ran in to was that I couldn't find anyone that could tell me it was right for me that wasn't selling it, so I decided not to go with it in the end.

Post edited 4:02 am – September 10, 2013 by getrichwithme

If you want life insurance you can get it cheaper as a stand alone policy term insurance policy

If you want an investment why would you want to tie it to an insurance policy – you can get better returns (and much lower policy costs) by using an index tracker ?

With regards to the insurance – you have to consider what you are insuring yourself for ?

Is it to protect your mortgage and spouse if you die ? If so why not get term insurance – its cheaper?

Is it to protect your families income if you were to die ? Again – you only need insurance cover until your kids leave home/college – so again term insurance is better and cheaper.

There is only one reason why Whole Of Life is appropriate – and that is to provide money to cover a financial liability after the age of 75 (after which term insurance is no longer available) – one of the few things i can think of is to cover death/inheritance taxes.

Even then, if your using life insurance to cover death/inheritance taxes it needs to be written in trust – something that the average insurance salesman cant do.

I personally own high cash value whole of life policies.Most of my insurance portfolio consists of these products.Others are of shorter tenures,bought for their high returns(compared to bonds,and more tax efficient too).

I am also a fully qualified insurance adviser.

I bought these products because I could use them to cover any loans I avail of in my lifetime.I am a businessperson,so I see myself borrowing lifelong.

Its very important to me to leave an inheritance behind for all my descendants. These policies are a hassle-free,simple and tax-efficient way to do so.

Also in case of emergencies,in old age I could use these policies to pay me a pension or draw-upon them to finance extraordinary medical expenses or just contribute to the education,home-purchase or business establishment expenses of younger family members.

These policies will never give me stock-market returns or business-like returns.But they give me best in class bond-like returns and keep up with inflation.I see these savings as a fall back position,in case of severe reverses in my businesses.