Whole life insurance is crazy. I have 4 policies since ‘80 and ‘85. I was thinking about taking money out for an European trip. Found out what Dave is saying is true. Not only will my cash value go down, dollar for dollar, which makes sense, but my death benefit will go down even more than the amount I would take out. I asked my agent about it, and got some convoluted explanation why that happened that made no sense.
I like how they say you can borrow against it and be your own bank. As if over 10 years you couodnt just save instead of paying multiple times the premium. Such a scam.
Look at the Stats, only 2% of term policies pay out! So why would you not open a whole life policies that grows and accumulates value over time like at State Farm, those policies grow death benefits. Whole life policies are guaranteed payouts at State Farm. Even for suicide
Back in 1980 when I graduated college, a high school acquaintance looked me up to pitch one of these nonsense whole life policies. I had enough sense to decline. I may have been born at night, but it wasn't LAST night!
I’d never heard of whole life (I’m not from the US, where I’m from only term life is common) but the second somebody close to me (who’d had a family member buy them in when young) started telling me about it my BS detector flagged. I essentially cut off the usual “benefits” such as being *allowed* to take out your own money (some benefit…) and told them that from what they’d told me it was probably a scam product but I’d do some research. It’s insane how many people are duped into signing up themselves and family members without reading into the actual product being sold.
I was pitched whole life at my first job in about 2002-2003 and had a similar reaction - premium was too high and death benefit was too low. Make it make sense!
You guys honestly can’t be that dumb? Whole life policies are the only policy that are guaranteed payout as long as you pay premium. Only two percent of term policies pay out just look at the stats. Whole life policies build a cash value that you can borrow against Tax Free. You have to pay the loan back yes but you can pay as little back as you want.
@@linuxsurfer2002you can’t be that dumb, whole life insurance grows overtime as you pay on it. A 25k whole life policy would pay 40k by the time you are 50. ONLY 2% of Term policies pay out, I can’t believe you guys actually listen to this man
Hey Dalton, my husband is also a diesel tech. He’s been in the business 12+ years. 22K isn’t great, but I know other techs making $33+ an hour! Maybe apply at some different shops and see what they offer you.
Dalton is so young he must be an entry level guy at this point but he still should be getting better pay. I am a diesel tech and made $109k in 2023. I get $47.78/hr plus full benefits. Servicers in my company (the guys who just change oil and tires) make $25.88/hr. You must have 5 years minimum experience to be a mechanic at my company but servicers can come in with little or no experience. Now this is a really good paying company but there is a lot more than $22k a year to be made for him out there if he looks around. Techs in diesel and automotive are desperately needed everywhere.
@@davidgamez5476Yeah, it's incredibly sad that he comes in to work and takes these calls without knowing his ass from a hole in the ground when it comes to the difference in IUL and Whole Life.
Cut your losses. Don’t throw good money after bad. I’m sorry this happened. I narrowly escaped the same situation when I was about 25 years old. It was a $1 million policy, and the premiums were a lot higher. I didn’t want to do it. Fortunately, my grandma told me that 1) I had no one to protect; and 2) term insurance was better.
@mda0214 whole life a lousy insurance product that doesn't offer any protections from hyper inflation or loss of USD as the reserve currency. It also offers terrible finnancial growth that is more cheaply and better severed by a simple brokerage account. I fail to find any benefit from whole life that isn't better managed with a term policy plus brokerage and treasury investments.
That’s why I’m a term life insurance agent. I do what’s best for the community not what’s best for my commission check. I wouldn’t be able to sleep at night knowing I’m intentionally screwing hard working people over.
just write off as a loss, in essence (whole life) is a combo product of life insurance and investment. The problem is it is not really better than separate term-life and investment as separate items. Term-life is cheap for young people, suitable if you have a mortgage, wife + children. If you invest separately, by the time term-life becomes impractically expensive, your investment should render it unnecessary.
We bought a whole life policy in the mid 90s, $100K. It was $67/mo. Probably a year in we wised up and dumped it. Minimal cash back but for $425/yr we got $750K term life and still have that one. With everything else I'm worth far more dead than alive.
Only 2% of term policies pay out. Whole life policies will 100% pay out as long as you paid the period. Taking a policy out while you are young and health is the best thing you can do. $425 for 750k is an amazing rate. At State Farm our policies grow in value overtime 750k would be 1million when you die. And we pay out for all deaths including suicide
The only issue with Term is that it expires at some point (or, if it's guaranteed renewable, becomes more expensive at each renewal). It's great for young, healthy people who want to cover their families when a death could spell financial ruin. However, depending on your term policy, those benefits are no longer relevant when you're older. Whole life is okay for people who want coverage that will never expire and won't get more expensive when they're older and on a fixed income. Both types have their uses.
I had a couple "advisors" from Northwestern Mutual reach out to me, schedule zoom meetings to discuss Life insurance policies in 2021 6 months after i had just graduated college and started working. They stated its highly recommended to get this early in life as th epremiums are cheaper when you're younger and all that stuff. But i never got enough clear info on the benefits, what I'm paying, and what I'm getting back so i said no. Glad to hear i made the right decision there
My mom sells insurance and she wanted me to get a whole life policy to help her sales numbers I knew it sucked but did it anyway for my mom . Same deal 1.5 years later I just said nope I’m done with this junk and I got nothing back after canceling
You don’t get anything back after canceling after a year because the insurance company front loads all of the cost In the underwriting process. That’s why you don’t see cash value for the first two years. Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me? It’s best to open a policy while you are young and healthy. Rates get higher the older you are
@@ethanpaige9471 - Just another reason why Whole is a sucker's policy. If this person bought term insurance for about 15 times cheaper, he could have invested the money in a ROTH IRA or 401K and would have been able to keep the money. You know what I am saying is true. I'm sure you'll try to convolute the issue, but Ramsey is right on this one. Buy term insurance and invest the difference. Don't let the insurance companies keep YOUR assets when you cancel.
The thing that I wish they’d told Dalton is the best news of all is figuring this out at 20 years old is a great sign that he will likely have a great financial future. If so, that $1,100 might wind up being peanuts compared to what he benefitted from the experience.
I’m really sick of insurance salespeople calling themselves financial advisors. To a lay person, when you hear financial advisor you think someone who will look at your whole financial picture, and do their best to help you achieve whatever goals you have. When someone is selling insurance products in which they receive a commission, even the best intentioned really will struggle to perform as a true fiduciary. There needs to be more education on the types of financial advisors, what fee only means, and what a fiduciary is.
@@ethanpaige9471 - Exactly. Just another reason to buy term insurance. Why pay about 15 times more for a policy that never pays out? Buy term insurance and invest the difference on your own. That way, when you cancel or let your policy lapse, you still get to keep your investment, rather than letting the insurance company take it from you.
@@JohnBowl14690 you can buy a whole life policy that guarantees to pay out. Only 2% of polcies pay out because you naturally outlive you term. And then you’re 80 years old without money or life insurance after you use up retirement. Because a normal person isn’t leaving 2 million behind. They are going to spend their money during retirement. There are whole life policies that can make you money and you only have to make payments for 10-20-30 years and you can take money from cash value without having to pay it back. Cash value also gets paid out to your beneficiaries if you do not use it
I know it sucks ,but use it as tool ,you were guided by your parents, now u know ,,,,your the one that will read about loopholes in life and makes your own decision
Absolutely!! NEVER continue putting your money down a drain or, as Dave said, into a pocket with a (big ass) hole! Get a new pocket! Term life to protect your income for others and a Roth IRA funded by a real investment based on ownership of great publicly traded companies, ie, stocks and/or mutual funds. NEVER buy permanent cash value life insurance. It's one of the greatest frauds in the history of the world!
Another reason the cash value is tax free is because you will not see a gain in your cash value over your premium paid if you surrender your policy. And if you do receive a gain in your polic, if and when it endows, it will be subject to income tax on the gain of only 1% to 2%, a guaranteed loss of your purchasing power after inflation & taxes!
😂 when I got out of the army I was looking for employment. I almost fell for a life Insurance company who at the seminar told me to go to sell to my family & friends....I new something didn't feel right and left!
I don't see the issue with life insurance if it is explained correctly and somebody knows what they are buying. I mean, Term is probably the best thing for most younger people, but after a certain age, or if you get a disability or terminal sickness, you are just uninsurable. Term insurance rates for older people get ridiculously unaffordable. At least with some version of whole life, you build cash value (slowly!) and can never be denied coverage. With whole life, either you die, and it pays out, or you live to 100, and it pays out. Yes, you can borrow against the cash value. (Technically, you don't have to pay it back, but its certainly better if you do.) As Ramsay says, loans aren't taxed. If you take out a policy loan, you pay it back (with interest, just like a bank loan). The only upside to this is you don't need to be approved by a banker. If you need the money NOW, you take it out and avoid having to justify your needs to a banker and stay away from those obscene payday loans. If a policy loan is not paid back, that money comes out of your death benefit. All that said, selling a whole life policy as an investment is, at best, incorrect. It isn't an investment that builds significant wealth. It can protect wealth and distribute it to those you want to take care of. It is basically saving your own money for your own death. And if you die before it endows the insurance policy kicks in and covers the rest. NOBODY is going to get rich off of a whole life insurance policy, but that does not make them a scam. As far as a lot of agents, I expect many of them don't actually know the finer points of what they are selling or how to explain it properly in layman's terms.
@@tamiacolbert4257 Hi, I thought I replied to this, but apparently, I didn't finish what I started. I'm sorry if you end up with two answers. Yes, I'm licensed in both Life and Health.
I interviewed for a company that does this fresh out of college and what they say is true. They wanted me to make a list of everyone I knew. They wanted to take advantage of the fact that I was young and had no money. Glad I saw through it and didn’t try to sell my people financial poison.
I appreciate that people such as Dalton wants to be responsible and get life insurance. It's sad and pathetic that predatory insurance folk take that good natured person and put them in a whole life insurance policy that will not truly benefit him. Term is the way to go because term is what you really need. For a period of time i.e. term. At 51, I do NOT have life insurance because my net worth is such that I do NOT need it. And note, I'm not rich, not an everyday millionaire (yet), but I live debt free, modestly, I only have one child who is an adult so my financial needs do not require a million plus. And I have sufficient $$$ in my checking to bury me without a worry.
reminds me of this quote "Let's say you make $50,000 a year. It costs you $950,000 per year, to not know how to make $1,000,000. How much is that education worth?" -Alex Hormozi
Yes! Buy trem insurance because it's 8/10 times cheaper than whole life,and you will get way more coverage. Buying term insurance is buying money and investing the difference into a mutual fund. A mutual fund will have way more money gain than what a cash value will ever grow for any individual. I have my securities and life licenses, so I have studied the difference when it comes to whole life and term life insurance.
@@nugsin4 i know a life-long single woman who is in her 60s and has several whole life policies she’s been paying on for decades. I dunno….. Maybe to square your estate if you want to give it in a will. Maybe you won’t always be single. Maybe you have a kid you don’t yet know about. There are reasons for singe people to get life insurance. 🤷🏼♂
@@nugsin4 Well, he did get whole life in the first place. Maybe he doesn't need life insurance at all, but I would assume he's not planning to be single forever.
He's 20. He doesn't need insurance at all. Also, he makes $22K a year.....what the hell would even be insuring? He should take that $150/month and put it in an index fund so he can buy a house one day. People that don't have assets, don't need insurance.
I took an interview with one of these places once when I was a new graduate not knowing what it was and man I’m glad it didn’t go any further. It was weird they’ll ask you right out how many people you know. Just gives you a bad feeling listening to them
Insurance is mandatory to have in order to drive a car or own a home. It’s a great industry and never going away. State Farm is a great company to work for
Income isn't borrowed. Income, by definition, doesn't have to be paid back. It is money that you receive that you keep. And if it does, it is NOT income.
I got into something similar once. fortunately i invested only $1000 but even after the 10 years i had a hard time getting it back. My financial advisor was able to get it but only after their requiring both of us to jump through all kinds of hoops and their creating every delay they could think of. But mine was a one time investment and just let it sit 10 years.
I literally just signed my universal life plan and then saw this video. I thought I was buying term life insurance. Should I cancel my plan? 😢 a friend from school told me to do this. I’m 18
This segment makes me wonder. As much as I enjoy PBD podcasts, he started out selling insurance. I wonder what kind of insurance he sold that help him became a millionaire.
I only trust a Financial Adviser who acts as a fiduciary on my behalf. If the person is basically a salesman for some investment product, they are trying to earn their commission rather than giving legitimate financial advice.
He has other videos that explain it, but basically the premiums are super high, and the "return" is horrible. You are far better off financially to get a term policy to get you through your younger years, and build up the difference in your retirement/investments, so that you don't need an insurance payout when you eventually die at an old age.
It's quite a bit amount of details. Search Dave Ramsey universal life and you'll find a whole lot of calls from folks who got screwed by IUL's. Also, George Kamel made a detailed video in his channel breaking down IUL's.
Basically, you would in almost all circumstances be better off buying term insurance, and investing the difference. IUL has incredibly poor returns after you factor in all the fees and limitations.
I am trying to get into Insurance Industry and many employers will Fire you if mention or discuss Dave Ramsey. I refuse to sell Whole Life Insurance polices, I think Only product I willing to sell is Indexed Polciy backed by the S&P 500 or NAsdaq
So, I fell into this trap even knowing how bad they are. But I trusted a friend so I took it. I put 1500 a month. The i decided to cancel it because on the Yearly statement I realized they took 1/3 of allegedly ""expenses". Then to find out I get Zero if I cancel. I was frustrated beyond belief with the thought I have to loose 20 k to cancel or Loosing more on the long run because student loans Interest grow faster that this policy. I will talk to my CPA and see if something can be done. For example putting the insurance under my s-corp and get the deduction to offset the cost and keep the benefits. I wander what David would say about this or just loose the 20 k. What would you guys do in my situation?.
hi I am in a very similar situation, what did you ended up doing with your policy. I have a policy worth 4k but if I cancel I lose it all. I also have a business as well. I am trying to see if I can put the insurace under a business like you said.
You shouldn't need life insurance that long anyway. If you manage your finances well over the course of your life, you will get to the point where your net worth is such that life insurance is no longer necessary. It would only be in a very specific circumstance where someone with a strong net worth would require life insurance. Such as owning a business and then there are options specifically for that and they could be written off as a business expense.
@@crashtestdummy1972 My policy is life long through TransAmerica. If I die (hopefully not), my beneficiaries receive 1/2 million dollars. I would get a retirement after 65 for about only a quarter of a million dollars, and I invest $265 a month. The other good aspect to this all is that I never lose money due to the lows of the Stock Market.
We bought my wife a Universal life policy in 1995 or 1996. We still have it in force. I use it as a savings vehicle as it was paying 4.5% when savings rates were 25 basis points. Here’s the best part. It was underwritten when we were young w/ no health issues. Now, almost 30 years later, we still have the insurance in force at a relatively cheap price. A term policy would cost more at this point.
@@natersalad889 don’t confuse U life with whole life. U life is basically term insurance wrapped with a savings component. For years when we were young and poor, the premium we paid was $300 a year ($25 a month) for $100k of insurance and there was still some cash value build up. Had I put $300 a year into savings over the past 28 years, It still wouldn’t be $100k even with Dave’s mythical 10% returns. And if the wife had passed when the kids were young, we would have had very little to help us get through it.
You're comparing apples to oranges. $100k death benefit is not the same thing as say contributing that $25 into the stock market. I'd be curious what your cash value is. @@tywebbgolfenthusiast8950
What you have is a Universal Life Policy - Dalton bought an Indexed Universal Life Policy. Big Difference. UL’s have their place. IUL’s are garbage and are only good for the slime bag selling them.
You're a "diesel tech" and you only make 22K? Dave, how did you just miss that? $1100 is nothing compared to what this guy is missing out on his income. He should be making double that at least.
What a screw job this young man is going through,a lose/lose situation. Breaks my heart knowing that these idiots screw good ppl out of their money. Especially those who are in their early 20s, and in college.
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me. Did Dave forget to tell you only 2% of term policies actually pay out
As a full time successful life insurance agent for the past 18 years I will sell you anything you want either it be term or whole life or universal life. The idea or buying term and investing the difference and not needing any life insurance when the term is over is a great idea and the ideal situation. But let me tell you after selling and meeting with thousands of people this almost never happens. The majority of the population is broke, lives on paycheck to paycheck and never invest or build any wealth. I know this because i meet with a lot of seniors that are over 60 years old and very upset that their term insurance expired and they want to buy $10,000-$30,000 Whole life policies to cover funeral cost. They dont care about the cash value they care about the fact that whole life never ends and never goes up in cost. They want it to be there when they die of old age. These people would have been better off starting off with a whole life policy.
Not all true! You two were given really bad policies-I agree! Saha me on those agents! Unless you’re an updated broker, you don’t understand all the ins and outs of different policies. There are good policies that can transfer wealth to your family or even yourself, if you have a good broker to help you. If it’s an agent, they can only sell you what’s available with the company. A broker aka financial advisor is different. I’m sore there are some out there that’s not honest and in it for themselves, but most brokers are in it to serve.
George…if you want to take a piece of the wheel eventually, memorize this stuff and be able to spit it out like Dave. No reading..I understand you are pushing the book, but c’mon man. No reading. 😂
If he had a family to take care of, perhaps. But it sounds like he is single so he wouldn't need a policy. And even if he did need insurance, at only $22k per year, 10x his income would be around a $250 policy, so a 20 year term policy would cost about $7-10/month. Even if he went 20x his income ($500k) it would be around $20-25 a month. $150/month for the current policy is literally between 6 and 15 times as expensive as what he needs, even if he does need it.
I agree with Dave gtfo of this life insurance policy. However I wouldn't say anything to your parents about it. Your parents love ya but in my adult years I've learned that talking about finances with family can be a touchy subject. I'm willing to bet they invested a ton in life insurance and aren't willing to admit that it's a bad investment. So it's really up to them to get out of it. Also, just remember it's your money not there so don't let family members guilt you.
@@xplorercolorado9224 you don’t have to pay it back… you can take it all out and the policy is still active and will always pay out the face value death benefit. No the loan does not get subtracted from the death benefit.
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me. Did Dave forget to mention only 2% of term policies pay out 😊
A Northwest Mutual guy kept trying to sell me a Whole Life policy. I knew it was a bad deal, so to be a jerk, I just strung him along.....never saying "No!", but of course never saying "Yes!". Wasting their time is the best thing you can do to these people.
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me only 2% of term policies pay out. Or are you going to wait until you’re 80 to take a policy out
@@DaveCompton5150 and let’s hope you don’t use any money during retirement. because you are going to put 65k aside for funeral? Also do you know how much an estate transfer cost? I’ve seen families file for bankruptcy because of death
@@DaveCompton5150 that’s not financial planning. That’s hoping you aren’t broke. Which by the time you’re 86 you’re going to be arguing about your bill because you’re gonna fixed income. Happens all the time
![[TH] 2024 PMGC League | Survival Stage วันที่ 1 | PUBG MOBILE Global Championship](http://i.ytimg.com/vi/FVFT-PFwU80/mqdefault.jpg)
Whole life insurance is crazy. I have 4 policies since ‘80 and ‘85. I was thinking about taking money out for an European trip. Found out what Dave is saying is true. Not only will my cash value go down, dollar for dollar, which makes sense, but my death benefit will go down even more than the amount I would take out. I asked my agent about it, and got some convoluted explanation why that happened that made no sense.
"Because fvck you, we already got your money and we wont give it back, that is why" On other words of course but essentially that.
//edit: nvm just read through some pages and understand why it's bad ^^
I like how they say you can borrow against it and be your own bank. As if over 10 years you couodnt just save instead of paying multiple times the premium. Such a scam.
time to get a new financial advisor.
*a* European trip
I click on every Dave whole life video. I LOVE the unbridled merciless rage every time.
I love it when Dave gets fired up lol such passion to do the right thing
At least he figured this out at 20! This won't impact his life at all in the long run.
Look at the Stats, only 2% of term policies pay out! So why would you not open a whole life policies that grows and accumulates value over time like at State Farm, those policies grow death benefits. Whole life policies are guaranteed payouts at State Farm. Even for suicide
He’s not a financial advisor, he is a salesmen. That guy screwed you!
He makes 10.50$ an hour if working full time. Getting that up should be his focus.
Back in 1980 when I graduated college, a high school acquaintance looked me up to pitch one of these nonsense whole life policies. I had enough sense to decline. I may have been born at night, but it wasn't LAST night!
I’d never heard of whole life (I’m not from the US, where I’m from only term life is common) but the second somebody close to me (who’d had a family member buy them in when young) started telling me about it my BS detector flagged. I essentially cut off the usual “benefits” such as being *allowed* to take out your own money (some benefit…) and told them that from what they’d told me it was probably a scam product but I’d do some research. It’s insane how many people are duped into signing up themselves and family members without reading into the actual product being sold.
I was pitched whole life at my first job in about 2002-2003 and had a similar reaction - premium was too high and death benefit was too low. Make it make sense!
You guys honestly can’t be that dumb? Whole life policies are the only policy that are guaranteed payout as long as you pay premium. Only two percent of term policies pay out just look at the stats. Whole life policies build a cash value that you can borrow against Tax Free. You have to pay the loan back yes but you can pay as little back as you want.
There is a cash surrender value that you you receive if you default on the policy. I work at State Farm
@@linuxsurfer2002you can’t be that dumb, whole life insurance grows overtime as you pay on it. A 25k whole life policy would pay 40k by the time you are 50. ONLY 2% of Term policies pay out, I can’t believe you guys actually listen to this man
Hey Dalton, my husband is also a diesel tech. He’s been in the business 12+ years.
22K isn’t great, but I know other techs making $33+ an hour! Maybe apply at some different shops and see what they offer you.
I know right. i was making more than that 20 years ago. Even as a new tech he should be making at least 20 an hour.
Yes, something is off. He is either a gofer & needs training or needs to find a decent shop
I used to be a diesel tech. That's insanely low pay. Any decent diesel tech these days is making $30+ a hour.
Dalton is so young he must be an entry level guy at this point but he still should be getting better pay. I am a diesel tech and made $109k in 2023. I get $47.78/hr plus full benefits. Servicers in my company (the guys who just change oil and tires) make $25.88/hr. You must have 5 years minimum experience to be a mechanic at my company but servicers can come in with little or no experience. Now this is a really good paying company but there is a lot more than $22k a year to be made for him out there if he looks around. Techs in diesel and automotive are desperately needed everywhere.
I was like WTH? Techs should be at $30/hr on the low end
I dumped northwestern mutual thanks to Dave Ramsey… and I do thank him for that
An IUL works way different than a whole life policy. Dave is misinformed on the difference and is talking about a whole life.
@@davidgamez5476Yeah, it's incredibly sad that he comes in to work and takes these calls without knowing his ass from a hole in the ground when it comes to the difference in IUL and Whole Life.
Cut your losses. Don’t throw good money after bad. I’m sorry this happened. I narrowly escaped the same situation when I was about 25 years old. It was a $1 million policy, and the premiums were a lot higher. I didn’t want to do it. Fortunately, my grandma told me that 1) I had no one to protect; and 2) term insurance was better.
My wife's $1M 30 year team policy is like $41/mo
Whole life and term are better together
@@mda0214 whole life is always dumb
@@thedude5040 lol what makes you think that?
@mda0214 whole life a lousy insurance product that doesn't offer any protections from hyper inflation or loss of USD as the reserve currency. It also offers terrible finnancial growth that is more cheaply and better severed by a simple brokerage account. I fail to find any benefit from whole life that isn't better managed with a term policy plus brokerage and treasury investments.
That’s why I’m a term life insurance agent. I do what’s best for the community not what’s best for my commission check. I wouldn’t be able to sleep at night knowing I’m intentionally screwing hard working people over.
just write off as a loss, in essence (whole life) is a combo product of life insurance and investment. The problem is it is not really better than separate term-life and investment as separate items. Term-life is cheap for young people, suitable if you have a mortgage, wife + children. If you invest separately, by the time term-life becomes impractically expensive, your investment should render it unnecessary.
I do believe that a combo of savings account and life insurance is a better description as you can borrow against your DB.
Thank you. I was mixing up universal and whole.
We bought a whole life policy in the mid 90s, $100K. It was $67/mo. Probably a year in we wised up and dumped it. Minimal cash back but for $425/yr we got $750K term life and still have that one. With everything else I'm worth far more dead than alive.
Only 2% of term policies pay out. Whole life policies will 100% pay out as long as you paid the period. Taking a policy out while you are young and health is the best thing you can do. $425 for 750k is an amazing rate. At State Farm our policies grow in value overtime 750k would be 1million when you die. And we pay out for all deaths including suicide
The only issue with Term is that it expires at some point (or, if it's guaranteed renewable, becomes more expensive at each renewal). It's great for young, healthy people who want to cover their families when a death could spell financial ruin. However, depending on your term policy, those benefits are no longer relevant when you're older. Whole life is okay for people who want coverage that will never expire and won't get more expensive when they're older and on a fixed income. Both types have their uses.
My friend sells insurance. Talked me into an IUL. I canceled it myself. Paid my stupid tax.
Dave is talking about a whole life and permanent. None are comparable to an IUL. He is old and confused. Whole life is way more expensive!
I had a couple "advisors" from Northwestern Mutual reach out to me, schedule zoom meetings to discuss Life insurance policies in 2021 6 months after i had just graduated college and started working. They stated its highly recommended to get this early in life as th epremiums are cheaper when you're younger and all that stuff. But i never got enough clear info on the benefits, what I'm paying, and what I'm getting back so i said no. Glad to hear i made the right decision there
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me
My mom sells insurance and she wanted me to get a whole life policy to help her sales numbers I knew it sucked but did it anyway for my mom . Same deal 1.5 years later I just said nope I’m done with this junk and I got nothing back after canceling
You don’t get anything back after canceling after a year because the insurance company front loads all of the cost In the underwriting process. That’s why you don’t see cash value for the first two years. Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me? It’s best to open a policy while you are young and healthy. Rates get higher the older you are
@@ethanpaige9471 i already had a term policy
@@ethanpaige9471So what kind of policy do you recommend? And why.
@@ethanpaige9471 - Just another reason why Whole is a sucker's policy. If this person bought term insurance for about 15 times cheaper, he could have invested the money in a ROTH IRA or 401K and would have been able to keep the money. You know what I am saying is true. I'm sure you'll try to convolute the issue, but Ramsey is right on this one. Buy term insurance and invest the difference. Don't let the insurance companies keep YOUR assets when you cancel.
Buy term and invest the difference between the cost of whole live and the cost of term insurance. Term insurance costs less
The thing that I wish they’d told Dalton is the best news of all is figuring this out at 20 years old is a great sign that he will likely have a great financial future. If so, that $1,100 might wind up being peanuts compared to what he benefitted from the experience.
Tuition for the School of Hard Knocks
I’m really sick of insurance salespeople calling themselves financial advisors. To a lay person, when you hear financial advisor you think someone who will look at your whole financial picture, and do their best to help you achieve whatever goals you have. When someone is selling insurance products in which they receive a commission, even the best intentioned really will struggle to perform as a true fiduciary. There needs to be more education on the types of financial advisors, what fee only means, and what a fiduciary is.
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me
Only 2% of term policies pay out
@@ethanpaige9471 - Exactly. Just another reason to buy term insurance. Why pay about 15 times more for a policy that never pays out? Buy term insurance and invest the difference on your own. That way, when you cancel or let your policy lapse, you still get to keep your investment, rather than letting the insurance company take it from you.
@@JohnBowl14690 you can buy a whole life policy that guarantees to pay out. Only 2% of polcies pay out because you naturally outlive you term. And then you’re 80 years old without money or life insurance after you use up retirement. Because a normal person isn’t leaving 2 million behind. They are going to spend their money during retirement. There are whole life policies that can make you money and you only have to make payments for 10-20-30 years and you can take money from cash value without having to pay it back. Cash value also gets paid out to your beneficiaries if you do not use it
I just closed my university life insurance yesterday. I had it for 1 1/2 year. I trusted my friend and she screwed me. My heart is broken.
Do you think she knew she was screwing you? OR was she new and not 100% sure of the pitfalls of what she was selling?
You do know there's a huge difference between a whole life and an indexed universal life insurance right?
@@davidgamez5476 no she doesn't. Wait until they get the bill for the 401k and IRA.
@@davidgamez5476 can someone explain it to me?
Anyone who listens to Dave should know enough not to buy stupid products. This young man learned.
I know it sucks ,but use it as tool ,you were guided by your parents, now u know ,,,,your the one that will read about loopholes in life and makes your own decision
The bigger questions: Should Dalton's parents stop their policy? Should Dalton tell them it's a scam?
Dalton should never take financial advice from his partners again.
Absolutely!! NEVER continue putting your money down a drain or, as Dave said, into a pocket with a (big ass) hole! Get a new pocket! Term life to protect your income for others and a Roth IRA funded by a real investment based on ownership of great publicly traded companies, ie, stocks and/or mutual funds. NEVER buy permanent cash value life insurance. It's one of the greatest frauds in the history of the world!
How do people do 0 research before commiting to paying for huge things? Insane to me
I have a term life policy with Northwestern mutual. They are always pushing that whole life on me 😆
My father invested in them, I had to convince him to get out. He eventually lost around 1000 dollars in surrender charges.
Another reason the cash value is tax free is because you will not see a gain in your cash value over your premium paid if you surrender your policy. And if you do receive a gain in your polic, if and when it endows, it will be subject to income tax on the gain of only 1% to 2%, a guaranteed loss of your purchasing power after inflation & taxes!
Nothing like a good video of Dave getting fired up.
me too. I canceled my IUL loss 4k on it. Cash value is 0. I was so angry but better than keeping on paying and lose more money.
This is true stuff I used to be an agent.
😂 when I got out of the army I was looking for employment. I almost fell for a life Insurance company who at the seminar told me to go to sell to my family & friends....I new something didn't feel right and left!
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me
Dalton if you reading this come to Indygo. Were hiring $28+ hr.
I don't see the issue with life insurance if it is explained correctly and somebody knows what they are buying. I mean, Term is probably the best thing for most younger people, but after a certain age, or if you get a disability or terminal sickness, you are just uninsurable. Term insurance rates for older people get ridiculously unaffordable.
At least with some version of whole life, you build cash value (slowly!) and can never be denied coverage. With whole life, either you die, and it pays out, or you live to 100, and it pays out. Yes, you can borrow against the cash value. (Technically, you don't have to pay it back, but its certainly better if you do.) As Ramsay says, loans aren't taxed. If you take out a policy loan, you pay it back (with interest, just like a bank loan). The only upside to this is you don't need to be approved by a banker. If you need the money NOW, you take it out and avoid having to justify your needs to a banker and stay away from those obscene payday loans. If a policy loan is not paid back, that money comes out of your death benefit.
All that said, selling a whole life policy as an investment is, at best, incorrect. It isn't an investment that builds significant wealth. It can protect wealth and distribute it to those you want to take care of. It is basically saving your own money for your own death. And if you die before it endows the insurance policy kicks in and covers the rest. NOBODY is going to get rich off of a whole life insurance policy, but that does not make them a scam. As far as a lot of agents, I expect many of them don't actually know the finer points of what they are selling or how to explain it properly in layman's terms.
Respectfully, do you have a life insurance license?
@@tamiacolbert4257 Yeah, I have a life and health license.
@@tamiacolbert4257 Hi, I thought I replied to this, but apparently, I didn't finish what I started. I'm sorry if you end up with two answers. Yes, I'm licensed in both Life and Health.
I hope somebody also counsels this young man that he does not need life insurance at all right now
How come?
@@03C_R because he has no dependents as far as we know (safe assumption). Life insurance is meant for those left behind. These salespeople are scum
I interviewed for a company that does this fresh out of college and what they say is true. They wanted me to make a list of everyone I knew. They wanted to take advantage of the fact that I was young and had no money. Glad I saw through it and didn’t try to sell my people financial poison.
Just ask iul agent how much is their commission
Diesel tech, only makes $22.000 per year? That seems very low?
Part time maybe, or maybe they just started and only had a partial year last year? It's definitely low.
22k/year as a diesel technician is crazy he should be making ALOT more
He could go to cat or Cummins and they will pay for his training and he will make 100k+ a year in no time.
I appreciate that people such as Dalton wants to be responsible and get life insurance. It's sad and pathetic that predatory insurance folk take that good natured person and put them in a whole life insurance policy that will not truly benefit him.
Term is the way to go because term is what you really need. For a period of time i.e. term.
At 51, I do NOT have life insurance because my net worth is such that I do NOT need it. And note, I'm not rich, not an everyday millionaire (yet), but I live debt free, modestly, I only have one child who is an adult so my financial needs do not require a million plus. And I have sufficient $$$ in my checking to bury me without a worry.
reminds me of this quote
"Let's say you make $50,000 a year. It costs you $950,000 per year, to not know how to make $1,000,000. How much is that education worth?" -Alex Hormozi
what diesel tech makes less than $20 an hour? let alone $30? Our diesel guy travels across the country because of the work demand
Castodian sounds cooler than Janitor but you still clean up krapp
It's basically the Herbalife of the finance sector 🤣
Northwestern calls it Permanent Life insurance these days. Same bad financial product.
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me
He pays $150/month for whole life making $22K/year?!?! Imagine if he'd bought term life and invested the rest in the S&P.
He’s only 20. He has all kinds of time.
Yes! Buy trem insurance because it's 8/10 times cheaper than whole life,and you will get way more coverage. Buying term insurance is buying money and investing the difference into a mutual fund. A mutual fund will have way more money gain than what a cash value will ever grow for any individual. I have my securities and life licenses, so I have studied the difference when it comes to whole life and term life insurance.
@@nugsin4 i know a life-long single woman who is in her 60s and has several whole life policies she’s been paying on for decades. I dunno….. Maybe to square your estate if you want to give it in a will. Maybe you won’t always be single. Maybe you have a kid you don’t yet know about. There are reasons for singe people to get life insurance. 🤷🏼♂
@@nugsin4 Well, he did get whole life in the first place. Maybe he doesn't need life insurance at all, but I would assume he's not planning to be single forever.
He's 20. He doesn't need insurance at all. Also, he makes $22K a year.....what the hell would even be insuring? He should take that $150/month and put it in an index fund so he can buy a house one day. People that don't have assets, don't need insurance.
I took an interview with one of these places once when I was a new graduate not knowing what it was and man I’m glad it didn’t go any further. It was weird they’ll ask you right out how many people you know. Just gives you a bad feeling listening to them
Insurance is mandatory to have in order to drive a car or own a home. It’s a great industry and never going away. State Farm is a great company to work for
Borrowed money isnt taxed? Then why do i get taxed when the money gets to my bank as my income
Income isn't borrowed. Income, by definition, doesn't have to be paid back. It is money that you receive that you keep. And if it does, it is NOT income.
So, what kind of life policy is good?
Term life properly sized to your needs
Dave recommends term life policy that equals to 10-12 times your annual income. So if I make 75k, I should get a 750k policy.
22k as a mechanic?
I'd like to know how much returns is he making after 10 years.
I got into something similar once. fortunately i invested only $1000 but even after the 10 years i had a hard time getting it back. My financial advisor was able to get it but only after their requiring both of us to jump through all kinds of hoops and their creating every delay they could think of. But mine was a one time investment and just let it sit 10 years.
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me
I literally just signed my universal life plan and then saw this video. I thought I was buying term life insurance. Should I cancel my plan? 😢 a friend from school told me to do this. I’m 18
Yes
I was an insurance salesman once. For about 3 weeks. 2 weeks of training and one week to realize that it wasn't for me.
My dad beat the whole life system the way he did it is he died young. That sucked!
This segment makes me wonder. As much as I enjoy PBD podcasts, he started out selling insurance. I wonder what kind of insurance he sold that help him became a millionaire.
I only trust a Financial Adviser who acts as a fiduciary on my behalf. If the person is basically a salesman for some investment product, they are trying to earn their commission rather than giving legitimate financial advice.
Charge it to the game and move on.
😂😂😂Ramsey going in.. 😮😮😂
Imagine how much his parents must be losing
You are not saying why it’s a bad idea. Why?
He has other videos that explain it, but basically the premiums are super high, and the "return" is horrible. You are far better off financially to get a term policy to get you through your younger years, and build up the difference in your retirement/investments, so that you don't need an insurance payout when you eventually die at an old age.
What is the problem with fixed iul? I need to know before I start selling these items?
It's quite a bit amount of details. Search Dave Ramsey universal life and you'll find a whole lot of calls from folks who got screwed by IUL's. Also, George Kamel made a detailed video in his channel breaking down IUL's.
I have an IUL. I needed to take money out so easy. No problem
Basically, you would in almost all circumstances be better off buying term insurance, and investing the difference. IUL has incredibly poor returns after you factor in all the fees and limitations.
I am trying to get into Insurance Industry and many employers will Fire you if mention or discuss Dave Ramsey. I refuse to sell Whole Life Insurance polices, I think Only product I willing to sell is Indexed Polciy backed by the S&P 500 or NAsdaq
Did you even watch the video?
True that!
So, I fell into this trap even knowing how bad they are. But I trusted a friend so I took it. I put 1500 a month. The i decided to cancel it because on the Yearly statement I realized they took 1/3 of allegedly ""expenses". Then to find out I get Zero if I cancel. I was frustrated beyond belief with the thought I have to loose 20 k to cancel or Loosing more on the long run because student loans Interest grow faster that this policy. I will talk to my CPA and see if something can be done. For example putting the insurance under my s-corp and get the deduction to offset the cost and keep the benefits. I wander what David would say about this or just loose the 20 k. What would you guys do in my situation?.
hi I am in a very similar situation, what did you ended up doing with your policy. I have a policy worth 4k but if I cancel I lose it all. I also have a business as well. I am trying to see if I can put the insurace under a business like you said.
The real crime here is this guy is making $10.50/hr as a diesel tech. He could $3 more an hour at McDonald’s
Take the hit. Your payback period is less than a year.
I'm more frustrated why he's making $22k as a diesel mechanic 🤔
No, not 10 years, surrender period is 15-20 years.
I seriously doubt he even has $400. Usually it's 3 to 4 years of no money in the cash value.
What’s the longest term insurance you can get? I’m 25 can I get a 50 year term?
30 years is the longest.
After that it’s whole life and then universal.
Longest I ever hear of is 30 years.
You shouldn't need life insurance that long anyway. If you manage your finances well over the course of your life, you will get to the point where your net worth is such that life insurance is no longer necessary. It would only be in a very specific circumstance where someone with a strong net worth would require life insurance. Such as owning a business and then there are options specifically for that and they could be written off as a business expense.
@@GAFB1122 thank you! I’ve never thought of it that way.
I have an IUL, it’s not as bad as he’s saying.
Wouldn't you make more money by investing the rest of it if you just have a term policy?
@crashtestdummy1972 It's a horrible product. Anyone who sells it is screwing you.
@@jimroscovius i agree. I just would like to know a persons reasoning for getting one.
@@crashtestdummy1972 My policy is life long through TransAmerica. If I die (hopefully not), my beneficiaries receive 1/2 million dollars. I would get a retirement after 65 for about only a quarter of a million dollars, and I invest $265 a month. The other good aspect to this all is that I never lose money due to the lows of the Stock Market.
It's worse!!!
He needs to move. $22k as a diesel tech is extremely low. He needs to be closer to $65k to $70k.
We bought my wife a Universal life policy in 1995 or 1996. We still have it in force. I use it as a savings vehicle as it was paying 4.5% when savings rates were 25 basis points. Here’s the best part. It was underwritten when we were young w/ no health issues. Now, almost 30 years later, we still have the insurance in force at a relatively cheap price. A term policy would cost more at this point.
I'm sorry that you haven't used that many years to be able to invest outside of that and be able to self insure yourselves out of that horrible policy
@@natersalad889 don’t confuse U life with whole life. U life is basically term insurance wrapped with a savings component. For years when we were young and poor, the premium we paid was $300 a year ($25 a month) for $100k of insurance and there was still some cash value build up. Had I put $300 a year into savings over the past 28 years, It still wouldn’t be $100k even with Dave’s mythical 10% returns. And if the wife had passed when the kids were young, we would have had very little to help us get through it.
You're comparing apples to oranges. $100k death benefit is not the same thing as say contributing that $25 into the stock market.
I'd be curious what your cash value is.
@@tywebbgolfenthusiast8950
What you have is a Universal Life Policy - Dalton bought an Indexed Universal Life Policy. Big Difference. UL’s have their place. IUL’s are garbage and are only good for the slime bag selling them.
Whatever you do, don't look up what you would have if you had bought term and invested the difference in price - you'll end up depressed.
Ha! That’s nothing! I have a Multiverse life policy!
Everyone has to pay the stupid tax at some point my dude. Pay it and move on
Anyone work with a great Ramsey approved advisor? I got calls from so many when I signed up, I couldn’t choose and it seemed too “salesy”.
22,000 a year a diesel tech ? And 150 a month
Diesel technician making only 22k a year? Sounds like he needs a new job too. Most diesel techs I know make at least $60k.
Probably in training
You're a "diesel tech" and you only make 22K? Dave, how did you just miss that? $1100 is nothing compared to what this guy is missing out on his income. He should be making double that at least.
He's 20. He's still an apprentice. Gotta start someplace.
How does a diesel tech only make $22k a year in 2024?
"I was sold"
Move on and call it a stupid tax….
What a screw job this young man is going through,a lose/lose situation. Breaks my heart knowing that these idiots screw good ppl out of their money. Especially those who are in their early 20s, and in college.
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me. Did Dave forget to tell you only 2% of term policies actually pay out
A fraternity bro sold me back in 70s dumb as hell. But fact is at 20 new to work you don't need Life ins. at all.
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me
22k a year as a diesel tech????? Wtf????
Diesel tech 22 k 😂
As a full time successful life insurance agent for the past 18 years I will sell you anything you want either it be term or whole life or universal life. The idea or buying term and investing the difference and not needing any life insurance when the term is over is a great idea and the ideal situation. But let me tell you after selling and meeting with thousands of people this almost never happens. The majority of the population is broke, lives on paycheck to paycheck and never invest or build any wealth. I know this because i meet with a lot of seniors that are over 60 years old and very upset that their term insurance expired and they want to buy $10,000-$30,000 Whole life policies to cover funeral cost. They dont care about the cash value they care about the fact that whole life never ends and never goes up in cost. They want it to be there when they die of old age. These people would have been better off starting off with a whole life policy.
Very well said!
That’s a lot of money for a 22 year old. Sickening
Lol, such a staged call. When George plugged his book with a specific chapter, it make the stage so obvious.
Scam.
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me
10 bucks an hour as a diesel tech?! Is this video from 2012?
It was live on the air a couple weeks ago.
Not all true! You two were given really bad policies-I agree! Saha me on those agents!
Unless you’re an updated broker, you don’t understand all the ins and outs of different policies. There are good policies that can transfer wealth to your family or even yourself, if you have a good broker to help you. If it’s an agent, they can only sell you what’s available with the company. A broker aka financial advisor is different. I’m sore there are some out there that’s not honest and in it for themselves, but most brokers are in it to serve.
Your in the wrong channel if you think people are going to listen to your sales tactics.
If you sell an insurance policy, you are a sales person.
I Agree. Its sad to see so many people try to condemn a Profession and the Products that do serve millions of Households in the USA.
@@BunkMasterFlex77 Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me
George…if you want to take a piece of the wheel eventually, memorize this stuff and be able to spit it out like Dave. No reading..I understand you are pushing the book, but c’mon man. No reading. 😂
DAVE WHY DONT YOU MENTION ONLY 2% of term policies pay out
Why the f*** would a 20yr old need life insurance 😂, especially one that makes $22k/yr
If he had a family to take care of, perhaps. But it sounds like he is single so he wouldn't need a policy. And even if he did need insurance, at only $22k per year, 10x his income would be around a $250 policy, so a 20 year term policy would cost about $7-10/month. Even if he went 20x his income ($500k) it would be around $20-25 a month. $150/month for the current policy is literally between 6 and 15 times as expensive as what he needs, even if he does need it.
I agree with Dave gtfo of this life insurance policy. However I wouldn't say anything to your parents about it. Your parents love ya but in my adult years I've learned that talking about finances with family can be a touchy subject. I'm willing to bet they invested a ton in life insurance and aren't willing to admit that it's a bad investment. So it's really up to them to get out of it. Also, just remember it's your money not there so don't let family members guilt you.
His parents should know their financial advisor is a greasy salesman and not a good wealth manager
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me
DAVE WHY DONT YOU EXPLAIN THAT WHOLE LIFE POLICIES DONT HAVE STRUCTURED LOANS LIKE BANKS DO. YOU CAN PAY WHATEVER AMOUNT YOU WANT BACK
But why are you paying for your own money in the first place?
@@xplorercolorado9224 you don’t have to pay it back… you can take it all out and the policy is still active and will always pay out the face value death benefit. No the loan does not get subtracted from the death benefit.
You know it's a horrible product if it gets Dave agitated 😮
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me. Did Dave forget to mention only 2% of term policies pay out 😊
A Northwest Mutual guy kept trying to sell me a Whole Life policy. I knew it was a bad deal, so to be a jerk, I just strung him along.....never saying "No!", but of course never saying "Yes!". Wasting their time is the best thing you can do to these people.
Who’s going to pay 15-20k for your funeral when you die? Or will your family have to beg on a gofund me only 2% of term policies pay out. Or are you going to wait until you’re 80 to take a policy out
@@ethanpaige9471 Not gonna die broke
@@DaveCompton5150 because you know when you’re going to die?😂😂😂 this guy is hilarious. And try taking out a term policy while you are 60 years old
@@DaveCompton5150 and let’s hope you don’t use any money during retirement. because you are going to put 65k aside for funeral? Also do you know how much an estate transfer cost? I’ve seen families file for bankruptcy because of death
@@DaveCompton5150 that’s not financial planning. That’s hoping you aren’t broke. Which by the time you’re 86 you’re going to be arguing about your bill because you’re gonna fixed income. Happens all the time
Hahahaha financial advisor that should be illegal for them to say. Scummy insurance salesman
I cannot believe this man Dave sits here and lies about whole life policies