Life Insurance Facts : How to Use Life Insurance as an Investment


Hello, my name is Vic Schumacher, the company
is HPE Financial Services. Someone recently asked me the question, how do you use life
insurance as an investment? Well, it can be used as an investment, it should not be your
primary investment; however. The type of policy that you should obtain is one that builds
cash value. That could be a universal policy, it could be a whole life policy, it could
be a variable universal life policy. There are a variety of different policies out there
that build cash value. Some are risky, some are not. But if it does build cash value,
that would be how you would use it as an investment. What you can do is have a permanent policy
like this, pay in to it for a period of time, it builds cash value over a period of time,
and then as you get older, and the death benefit is what’s going to take place then, you can
with draw some of that cash value as a loan from the policy. Let’s just say the cash value
is built up to be several hundred thousand dollars, you can draw down that several hundred
thousand dollars in one lump sum or over a variety of period of time, and get some of
that cash value out and live on it. Then it has become a asset for you. The death benefit
is still there, in the event that you die, the beneficiary will still receive whatever
that benefit is, but the cash value has now built, and it has become a, like a large savings
account for you. So there’s a lot of advantages to using a life insurance policy as an investment.
It should not be your soul investment; however. If you want a policy that does build cash
value, contact a broker agent that represents a variety of companies. Let them guide you
through the best ways to do this. My name is Vic Schumacher, company is HPE Financial
Services, helping people every day.

10 comments

OMG did this guy have a brain fart cause what he is saying is sooooo ilegal. Insurance can not be stated as an investment product.

@GuitarOwl Bad news, your mistaken. The loan will have to be paid back. If you don't do it when your alive the company will take the loan out of the benefit amount.

If you take out 100k out of a 200k and use just the dividend to pay the premium, when you pass away your family will only get 100k from the 200k.

@GuitarOwl If you have to pay the money "back," even if it comes out of the death benefit, then you ARE paying back the loan. So, after reading the first line of your statement, "You don't need to pay the loan back" you are mistaken.

I think we both have the same facts, we just have different points. Yours I think is pay for more, i.e. the cost of a 200k WLP, and get less, i.e. a beneficiary get 100k. Why would anyone ever pay for two things just to get one?

My point is WLP is not a smart idea. If your family needed 200k when someone passes they would, in our explanation, be 100k short. Why would we do that to our family? Also if they only need 100k why are we saying pay hundreds of dollars for something we don't need?

If you wanted to, take a look at a WLP contract and read the section on "cost of insurance." This will blow your mind. Think of paying $100 a month in premium but your monthly cost of insurance is $300 or more and growing every year. This WLP's are designed to laps when people are alive and then guess what… that's right you have to pay the loan back & with taxes. That is one of the reasons people say buy term.

☺ Now we’re talking real numbers. From what you said you look to be 23 years old, or about. And if you want 15K a year to turn into 3.5 million would have to get you a ROR of about 5%. (FYI, I am so happy to see a young man like you taking charge of your money like this, good for you.)

Now this is VERY important to you: The S&P index over a 30-year period has not dropped below 10%. In fact from Dec of 79 to Dec 09 the S&P was 11.23%. Now, your same money (15k a year over 50 years) invested at an average of 11.23 will grow to $37,790,161 million.

The flaw in your plan is that when you give you money to a life insurance policy, they make the 37 million and give you the 3.5 million. Trying to make real money in any kind of CV life insurance is like trying to dump water out of the Titanic to keep if from sinking.

Leave a Reply