by Bill Boersma
I have a 35 year old healthy male listening to some agents pitch him on a life insurance funded supplement retirement income plan.
One is focusing on Indexed Universal Life (IUL) and the other on Variable Universal Life (VUL). With my help he put requests out to both. I specifically didn’t make the requests too tailored because I want to see what each comes back with.
Keeping it simple, the basics include:
– $25,000/yr premium
– Minimum initial death benefit
– Pay through age 65
– Illustrate income through age 90
I took what came back and tweaked it a bit to do my own analysis. For example, the IUL model assumes a 7.04% crediting rate in a one year S&P 500 Index. I then created a comparable VUL model using the same 7.04% return. As many details as possible between the two models were the same. What came back was a projected income from each that was almost identical; I’ll round it off to $175,000/year.
Here’s the question; which one is more realistic? I’m looking forward to hearing thoughts from all camps.
Bill Boersma is a CLU, AEP and LIC and the founder and owner of OC Consulting Group. More information can be found at www.OC-LIC.com, www.BillBoersmaOnLifeInsurance.info or email at bill@oc-lic.com or call at 616-456-1000.
Securities offered through Valmark Securities, Inc. Member FINRA, SIPC. Investment Advisory Services offered through Valmark Advisers, Inc. a SEC Registered Investment Advisor.
Indexes are unmanaged and do not incur fees, one cannot directly invest in an index.OC Consulting Group and its affiliates are separate entities from Valmark Securities, Inc. and Valmark Advisers, Inc.
