Ask Terry Questions Guaranteed Whole Life with (Non-Guaranteed Dividends)

Guaranteed Whole Life with (Non-Guaranteed Dividends)

By Terry Savage on October 03, 2023 | Financial Planning / Retirement

My spouse is 62 and I’m 80. Our financial advisor is suggesting that my wife purchase this insurance policy that has an Initial Base Amount 596,462, Initial Flexible Protection Rider Face Amount 596,461, Initial Total Face Amount 1,192,923 , Paid-Up Additions (PUAs). The premium would be 21,061 plus 8,464 Flexible Protection Rider, plus a PUA of 69,225 for a total of 98,750 for the first 4 years then the PUA dropping to 5,475 for the next 3 years for a total of 35,000 per/year, then no more PUA’s but premium and FPR continue for the next 31 years. I can see no reason that we would want to enter into this type of “investment” at our ages. I calculated that at 4% per year for the first 10 years of this policy, we would have 577,625 total premiums and 4% interest of 178,030 and the policy would have a “guaranteed” cash value of 540,733 plus the death benefit of 1,201,443 which would be of no value to either of us. My concern here is that my Financial Advisor is more interested in the commission of a large policy over our best interests. I follow your column every week and would really appreciate your opinion on this. Thank you for considering my question.

Terry Says

OMG — stop!! I couldn’t even read through the entire “idea” before smoke started rising in front of my eyes!!!
Yes, you are guaranteeing the salesman’s retirement — not your own.
Let’s start with the first premise: Why do you need life insurance at all at this stage of life??!!!

Don’t have another conversation with this person. Hang up when he/she calls!!
Then go to Wealthramp — read this link — to find a true and trusted FIDUCIARY financial advisor who is “fee-only” and not charging hidden commissions. YOu will be matched with a carefully-vetted fiduciary advisor. Or several, until it “clicks”. That advisor will help you with your entire financial plan for a set fee. You can trust them.

Please write back and tell me how you enjoyed the process and about your new, trusted advisor. A little bit of me will be worried until I hear back from you. So glad you wrote BEFORE you did this!!! You can definitely trust your instincts!

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