I used to work in a call center for an insurance company. Day in and day out, we get phone calls saying, my father/mother paid thousands a year for this policy for decades and now they die and we only got 20 grand??? Hated that job, worse than Walmart.
How do I get an Life insurance company to pay me, that I have a had a waiver of premium- due to disability, on it. I took this Policy out in 1998, and now it is 2020. I have let them know that I am now totally and permanently disabled. They have sent a letter to me saying I don’t qualify for this waiver of premium; even though I had not missed a premium payment. My policy is for $180,000. I can no longer easily pay the high premiums. I do not want to surrender it. As I have paid a lot into it. And I still have a mortgage and I am not able to continue to pay the high premiums. The letter they sent me said I had the right to appeal this decision for one year. Which would be another 6 or so months to be able to appeal it. Must I obtain an Attorney to do this appeal? I don’t have the money to hire a good Attorney, but feel that if it is my only chance to make this company pay my premiums, only until I am 70; I am 56 years old now, it may be worth it to borrow the money to appeal if I have a fighting chance to win the Appeal. Any suggestions on what I can do? I appreciate any input! Tammie Printz - Company is out of Minnesota- was called Minnesota Life; now goes by Securian.
Thinking about my retirement scares me.I apologize to everyone who is retired and filing social security after putting in all those years of work just to lose everything to a problem you weren't to blame for.it's especially difficult for people who are retired.
Indeed, It has always been more difficult to understand how to build your money after retirement and even more so right now with the inflation. You can experience a completely varietied market passively by employing a successful portfolio-advisor.
Even with no skills, it is still possible to hire one. I was a project manager and my personal portfolio of approximately $850k of my retirement pension took a big hit in April last year due to the crash. I quickly got in touch with a financial-planner that devised a defensive strategy to protect my funds and make profit from my portfolio this red season. I've made over $250k since then
“SONYA LEE MITCHELL” is the licensed consultant I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
Term policies are around 3X cheaper than permanent life insurance on average because the chance of a payout on behalf of the policyholder is less likely and 99 percent of all term policies never pay a death benefit because policyholders either stop paying premiums or outlive their term period. So the answer is: term and permanent life both have their upside and downside - you decide which suits your needs better or perhaps a combination of the two types of life insurance.
I purchase homeowner's insurance every year and never made a claim. Does that mean it's a bad purchase? NO!!! Insurance should only be purchased for RISK MANAGEMENT purposes. Trash value insurance is never a good buy. Letting an insurance company invest your money is beyond stupid.
@@Gogalen789ULs are worse than whole life. The cash cash value gets eaten up by all the fees/commissions leaving people to pay out of pocket for the ever increasing A.R.T. (Annual Renewable Term.)
I sell life insurance and I only sell Term life. The only time i sell whole life is if ive exhausted all efforts in swaying them to term. in 2019 I sold 90% term and 10% whole.
I worked for New York Life in Tampa Bay, my job consisted on calling back beneficiaries to burst them the news that after paying to us premiums for possibly multiple decades, NYL's underwriters came to discover after the investigation that the insured had a health condition that was not disclosed at the time of signing the policy, and even though the commercial on tv that lured them to by the policy indicated that not medical exam was required, an undisclosed health condition wold be sufficient for any insurance company not to have to pay a single penny, I hated my job and quit because I could not longer be an accomplice on ripping people off their money! Life insurance companies are worse than car insurance!
@Sherlock’s Redbeard Life Insurance is important when someone depends on your income. Most important if you have children. But best to buy term life insurance and at the same time invest in stock mutual funds. I started with $166 a month.
@@guitarcountry1, you’re telling that because you don’t even know how to have a custom while life with max funding, PUA, living benefits, chronic care, accelerated benefits riders. It works almost same as a mutual fund but your money is secured.
100% agree about credit card company being a scam 20% interest to Capital one, I experienced it and never again will have it. If I don't have cash to pay for it then I don't need it.
Some folks aren’t smart and not informed well about credit cards. We only use credit cards in my home and have made lots of money (cash backs) over the years. We pay off all balances before interest rates kick in. Facts are that some folks will always default and my cash backs are paid for by these kinds of folks who don’t understand credit cards.
Are you still looking by any chance? If so my office is doing free financial game-plans for families for the rest of the month through zoom. Would love for us to talk.
Honestly, if your young and healthy, whole life and term is a great way to go. You will out live term policies. And the more you renew, the more expensive it becomes. Whole life is level and will never go up in cost. My sister got a $100,000 whole life police for $67 a month. And thats honestly outstanding. I’m an agent. And I’ve seen people from 60 and up that only qualify for $10,000 at double the price. And after a certain period, you can borrow up to 75% of your payout to use as you want. They will only pay out the 25%. I always tell my clients “ if it doesn’t make sense, don’t buy what I’m selling. I’m here to help. Not harm. “. I’ve studied and passed my tests. Dave is a very smart man. But, I disagree with him on life insurance. Term is temporary.
My argument for keeping or buying whole life for a child - the earliest you can buy it the better due to low payments. They can be $10-$20/month and that is the set price. If you are blessed with having a child who reachs their 20s or gets married you sign it over to them and most likely there are no payments that are needed. If in the time between when they could be insured and adulthood they found out about having cancer, deadly allergies, epilepsy, or they smoke like a chimney or skydive they at least have something. I really wanted to buy whole life for our children but didn't. We found out our youngest has a bad but allergy and possibly sports asthma making things possibly harder in the future for getting a good deal on term.
Keep that thought process in mind because whole life intern life does have pros and cons both. What you just said is a real logic way to get some straight life insurance 🔥. at the end of the day people are paying $15 to ensure their cell phones.
I love the honesty and how educated he is. My coach educates and trains us daily and I am so grateful I work for a company that is truly for the ppl. Buy term and invest the difference! That's how you and your family WIN🎉❤😊
@@IAmFergI keep hearing about IUL but not really understanding it. Is IUL just good for investing or people who are into real estate? Or is it helpful for is a family member die, it will cover funeral costs plus give each family member a 10k check?
@@TimeisUp22 IUL can be used for both family and investments because in an IUL your money is always growing with you having full access tax free on top of the insurance. What makes IUL’s suck is Insurance agents can be greedy and fund them INCORRECTLY giving the agent more commission… that’s why people have mixed emotions on IULs but a IUL funded correctly is 100% best product on the market.
I love the truth and I really appreciate you! Honesty to people life is the best policy! You right who cares wat they say about you! Atleast you are helping us poor, middle class people! Thanks for your honesty! 🙏🏼🕊️❤️
I've sat with people who were A.L. Williams clients back in the 90's. They bought into the "Buy term and invest the difference." Well unfortunately over time they ended up SPENDING the difference. Sometimes it was lack of discipline, sometimes it was a job loss or divorce or something they couldn't have foreseen. So now they're starting over financially but their term is expiring and they've got medical issues that all but make them uninsurable. A permanent policy would have prevented that. Insurance shouldn't be your only investment platform, but you need a policy that will be there when you need it. Permanent insurance will do that.
Investing the difference saved using term, or even investing all what a whole life policy would cost and foregoing insurance completely, is not going to make anybody financially independent. It might help fund a vacation or two but then what? The best way to financial independence is to get a good education and to move up in your job, or to learn a trade. The fast track to debt is to join an MLM and peddle insurance to friends and family.
Thanks, Dave for this video I have been taking to the cleaners with these insurance scammers. I will not never get a whole life policy again. Thanks a million, Dave.
Common. A credit card is not good ?? Give me a brake. I got 0% APR credit cards that I play with and because I have great credit. No annual fees. And if it wasn’t for those I couldn’t have grown my business. Never paid a penny in interest. The cards are not a problem. The problem are uneducated or irresponsible Spenders.
Agree. What I notice is that Ramsey and others do not make clear is that Most individuals should not have credit cards as they are not responsible financially and probably in other matters (personal, relationships, etc.). Broad- brushing is usually not accurate.
I understand but first off 0% APR(after their promo period)? Be real. I have a 800 credit score not even I have 0% Apr credit cards. But anyways this information is for the average Joe. You have to be extremely disciplined to play with credit cards and win at the end. I myself stopped using cards only debit bc it just simplifies my life.And is very easy to disconnect yourself from real money. And just one day swipe on a big purchase. Just for some points.
Stick to used car salesman Dave’a advice and ultimately still blow tens of thousands on a cheap term policy you’ll statistically outlive and have nothing to show for in the end.
@@matthewmcguigan552 Agreed. It's funny how Dave never mentions that only about 3% of term insurance ever pays out. Companies who sell term are making a statistical bet that the person will outlive the policy thus never having to pay a check to the beneficiary.
@@astroman30 what are you talking about? There is certainly a need for whole life for some people. What is the most tax efficient way to leverage your money? How do you keep your estate most intact?(inheritance tax, probate fees..) this guy says that there is NO need for whole life ever. Which is completely wrong. This guy gives terrible investment advice
@@kawi4ev You're just a lying salesman who refuses to accept the truth: Whole Life insurance is (at least) 20 times more expensive than term in premiums. Oh sure, you're promised permanent insurance and a glowing cash value. Yet, the only way to get money out of CV is to borrow against it or cancel your policy? The average ROR on your precious cash value (after fees/taxes) is 1.5% Complete garbage.
I have a whole life policy. I pay $43/month for 40 years for a $50k policy. So in total I pay about $21k in premiums (unless I die sooner, in which case I'd pay less), and I get at least $50k (I could potentially get more depending on dividends for the policy that aren't guaranteed). So it's not a great investment obviously, but I don't think it's fair to compare it to having a credit card or a payday loan. I mean it does make money instead of being given away to the bank...
If my calculations are correct, this is a 4% return per year. It's not that bad, but I think Dave's point is that there are better investments out there that could be earning you 6-10%. For example, suppose that you switched to a term policy that was $5/month, and invested the difference of $38/month in a fund that earns 7% per year. That fund would have $106,276 at the end of the 40 years. Also, if it's whole life, how do you know it's 40 years? Don't you pay it until you die? I'm no expert at this stuff so take what I say with a grain of salt.
@@juanzapata7701cash value is a SCAM that’s part of the point of the video because it’s your “investment gains” that you can’t take out unless you close the account or borrow against it and both hurt or eliminate your death benefit. Moreover the “gains” are shit compared to a mediocre index
Credit card is good only if you can pay off the balance every month, not just pay the min. Payment +over 20% annual interest, which will drag the payments forever.
@@truckerstar24to build credit and to get the 1% back or points or whatever bonuses your card gives you. Why would you use a credit card if you don’t have the money to pay it right back? Not to mention then you definitely don’t have the money to pay interest
Well, you can maintain your checking account cash reserve without blowing all your cash. Basically, you can if you have too tier credit take out S1 to 2 thousand dollars out of your credit card feature, Called a balance transfer, then pay off the 0 percent balance in 12 months.
I tried scheduling a payment on a credit card to cover something I had just purchased with it, and it would not let me schedule a payment until the next billing cycle completed. They make it as hard as possible to keep up on payments.
This was the best explanation ever. As a former insurance agent this makes me mad i used to sell this garbage. I’m cancelling my policy and going term!
Dave only 1% of term insurance is paid out, the problem here is that most people don't invest properly or at all; so when they need the insurance the most they don't qualify for a new policy or the term policy has run out. People go into serious debt when they get sick or have an illness, in permanent policies you have the ability to access accelerated benefits while you're still alive, which can pay for your medical bills and other expenses to keep you out of debt. A 22 year old can pay $200 a month for $500,000 benefit, if the 22 year old paid that for 80 years that would be $192,000 put in with a return of $308,000 with the ability to access the health benefits in time of need. You are trading a smaller number for a bigger one.
Exactly, and I see many very wealthy, educated parents buy 10 pay or 20 pay life. The child could cash out for college, carry the insurance for life. Or in a worst case medical emergency, they could take an accelerated death benefit.
You see that's the thing, you were an FA, not an insurance agent. Only a well trained and educated insurance agent can communicate the benefits of life insurance. Whereas an FA will probably have a bias towards investments, which is fine, and also very different.
Your FA title didn’t make you immediately educated on how life insurance done right is by far the most superior financial product that was ever invented. I know many former FAs who are LI experts now because they learned how much of a rip-off most financial planning is.
Term insurance works better for middle class. You buy a term, and invest everything else to 401k, IRA, Roth and all other Index funds. Over 50 years, index will overrun the return from whole life by at least 200%. Whole life is good if you already max out everything else first and of course it is tax benefit to leave wealth to your beneficiaries.
Thanks Dave Ramsey I can't sleep now thinking about the extra I've been wasting on whole life when I could have put the extra into a simple mutual funds account and earned more over the same period of time..lesson learned and thank you I am forever grateful
My nephew got sold one of these... he has no kids and isn’t even 21 yet... his girlfriend called it a savings plan... I told them that these things are highly criticized and suggested she look into why they are bad... she said she looked into it and that the critics said that the plan they went with is one of the better ones but she could not communicate with me why they are critical... so in essence she got sold s bill of goods and does not want to think she made a bad decision... and of course the person who sold this to my nephew is someone from her family so that bit of psychology is working against my nephew
Your nephew has a great policy. I am a fiduciary and my daughters have had their own policies since they were 2 and 3 and it’s the best thing that they could have aside from their college accounts.
@@jreavestheleader8255 Dont't get any life insurance! It is a complete scam! Anyone who tells you to buy life insurance or tries telling you its a good idea does not know. You're 26 you have many more years of working and saving. Invest in something that will build equity and give you a return in the future that YOU have control over. Invest in the S&P 500, strong companies on the stock market, real estate, gold, silver. Buy and hold thats how Warren Buffet became rich, Buy and Hold. Life insurance only benefits the life insurance company and the salesperson who sells it. Make good financial decisions my friend. Cheers.
Life insurance is the most efficient way to transfer wealth from one generation to the next. Having a solid permanent life insurance plan in place makes great financial sense when part of your goals is to leave something behind regardless of what you statements say when you die.
Thank you for saving me from a horrrrible investment Mr. Ramsey! I'm 19 and am diving head first into financial freedom and had convinced myself whole life was better. A school teacher had told me you get cheaper premiums if you take out your life insurance when your younger and keep it you whole life but this benefit would not outway the huge premium price difference between term and whole life insurance. Thanks for all your knowledge!
Yep, Term life is you literally giving the insurance company free money with no risk to them because they know the odds of your family using it is near 0%. But whole life insurance gains tax free dividends up to 8% a year
Tatum, Dave Ramsey is right on this one. I'm in my 60s, retired, and never had cash value insurance. So I have been through the life cycle. I had term life insurance for 30 years. Very inexpensive. I invested $2000 a year ($166 a month) into mutual funds all those years and I can tell you this is the best plan. So glad I didn't buy cash value life insurance.
@@guitarcountry1 It's one path. Permanent insurance is another. Consider that you would have some accumulated amount of cash value, no further premium payments to make if the policy was structured that way, and still a death benefit intact to pass off to a beneficiary. Why would that be worse?
Get with a proper company that is financially stable. Be fully educated on how whole life products work and function. They're the most flexible asset out there. Again, contingent upon the company you are with. There's not a lot of companies out there that can actually do what they claim whole life can do. Be educated. He's not wrong, but he's not right.
Well said. Anyone who says that whole life is a bad thing doesn't understand the mechanics of life insurance, and anyone who says that there's no such thing as a permanent need for life insurance knows nothing about financial planning.
My entire family has always gone with IUL. Maybe I’m not getting it, but the example that Dave gave about being paid only the death benefit $15,000 and the insurance company taking the cash value/growth after years of contributions is only valid if you took a loan from your policy. The cash growth is collateral on the loan you take. I know this because my parents got the entirety of death benefit and cash value when my grandma passed. Never took a loan or anything.
Good thing I figured this out today 9/22/23 after our second annual payment for my kids, I’m getting term life insurance and canceling this whole life immediately, this is a game changer. It will save me thousands in the long run. 😧😧😧 Once again, thanks, Uncle Dave!
Thanks Uncle Dave, I write lots of Term Life, when suitable, but as usual, you're only partially correct, real life insurance is like owning property and you get you're money back plus equity, do you only "rent your whole life and invest the difference", your best agents can do both, JIM
Dave Ramsey, on this topic, is a complete idiot. If his statement were correct, then why does Bank of America have MORE whole life insurance on their balance sheet than they do other asset classes? BofA certainly is NOT "middle class."
@@paulbetancourt3749 Simple banks that carry WL are wrong. It doesn't take a rocket scientist to realize that insurance companies keep the cash value in the policy when the person dies. The only people who like WL policies are weasels who sell it.
@@astroman30 There is no helping ignorance. Not only do you not understand how while life insurance works, you do not understand how to include it in your investment portfolio nor how to leverage it for your investment cash flow in retirement. Good luck to you, I can't help stubborn and ignorant.
My dad was 56 when he got life insurance a term policy wouldn't work. Whole was high $ but at 100K policy with an 80% cash value available. I wasn't going to get a 20 year term and try to renew at 70. He did not invest so options weighed and decision made. I couldnt save or invest over 50K in 10 years if he passed. Term just wasn't the better option.
Both my mom and Aunt are 80 and have term insurance. Their premiums have went over 200 a month and their coverage has went down with one only being 15,000. I'm torn between term and whole because of this! I feel like both is a big scam!
It has a lot to do with age. They just explain an overall comparison here. But people live different lives. Some have riskier jobs some have kids / no kids. Term has the advantage of being cheaper and you can invest the rest on your own, except if your not responsible, you won't have the discipline anyways. You could get term at 25 then at 55 you need again but you have developed a health condition. Can barely work now how will you pay for the new term when it's gone up 10x
I really hope you are investing the rest because when your coverage is over it will cost about the same if you went with the Whole Life policy and that’s hoping that you are even insurable when you go to reapply
@@fr8tv4 the reason it’s called Term is because you are only covered for a certain term of time. Usually up to 30 years but obviously, the older you are, the more restrictions a company can place on it. For example at 50 you might only be offered a 20 year term and god forbid you become diabetic or if cancer or MS come into the picture than you will not be approved which is when you would need it the most
Term policies are temporary insurance contracts that have a maximum time frame which can keep a guaranteed flat payment. But once your contracted time has been met, it’s possible to keep paying for that contracted death benefit at what is called an annual renewable term and those price points can get pretty hefty. IE: 50 years old, 20 yr contract for $100k death benefit at $120 a month. Once 70 years old is reached can potentially become $700 a month the first year and will steadily increase each year after. Whole life is not the only permanent option to keep forever with cheaper cost of insurance for cash value growth. Source: I am an Advisor that does offer insurance options.
I don't think Dave truly understands whole life insurance and the opportunity that exists within those policies from an investment standpoint. He is right, do not withdrawl the money early, keep it in there. Do a 20 year pay and see what the policy is worth in 40 years after realizing 40 years of tax deferred growth inside the policy. Dividend rates in Canada right now range from 4-6.5%, not bad when you don't pay any tax as it accumulates. And, what other investments guarantee to give your money back after 20 years with the potential of realizing the upside growth potential, I can tell you not many that have a consistent 4 - 6.5% annual dividend rate.
@Day If he understood the product, his explanation would not be so inaccurate unless he was deliberately trying to misinform others. Life insurance companies make their profit margins off of term, NOT permanent, because permanent insurance is guaranteed to pay out while the overwhelming majority of term policies never will. The assurance of paying out is why permanent policies cost so much more; they have a limited amount of time within which to protect themselves against paying out way more than they receive in premiums, so the payments in the earliest years go more into covering the actual insurance. They can't just take in cash and hand it back and have that be a viable model, so they invest the premiums to grow the value and then pay dividends in return. The dividends grow the cash value as well as the death benefit so long as the company is a mutual one that returns revenue to policy-holders rather than outside shareholders. It's not merely a savings account, even though the returns vary based on financial strength of the company.
Well... I have been explaining the benefits of term life insurance and the many reasons why it is much better than whole life for years. I will be happy to explain it to you too. AND get you a FREE no obligation quote as well. Dave is Right.... Buy cheaper term, same coverage, invest the difference.... Get a lot more money returned.
I hope that you are investing the rest because when you reapply after the term it will cost you about the same as the whole life you didn’t get and more importantly, I hope that you are still insurable.
@@astroman30 Agree With Michael. Why is it that Life insurance guys get a bad rap. Some of us like helping people. Sure we get paid money. How much you think Dave is making from his Program. You think he is doing the show and video for free. People with knowledge and an expertise get paid.
Tragedy of the commons- individually a charge card (or a credit card used as a charge card) is good but the transaction fees used to fund rewards ends up raising prices for everyone.
@@hmrobert7016 not only that, the readily available nature of the card makes your spending habits more lose. If you have 200 in cash you are less likely to spend it than if you swipe the card. Obviously its 2020 so is more convenient to carry card instead of cash im just pointing out the psychology difference between paying with cash and paying with a card.
@@andrewfiore8926 I'm not understanding what is misleading? It's called the TRUTH! Suze Orman says the exact same things, and she IS a licensed agent in almost every state! Are you an insurance agent, by any chance? Because you may want to look into what you are being told to sell! Dave speaks the absolute truth, and it's all written in the fineprint of a policy.... Facts don't lie!!!! (Speaking from my own experience!)
😲😲😲 Most bankers (even bank managers!) don't know this, so don't feel bad! From my own personal experience, I know this to be the absolute truth!!! It's very sad how companies take advantage of their clients for a bigger paycheck!
When someone puts a complicated thing simple, often is inaccurate. I'd say it's worth discussing about insurance, about investment, about protection and about taxes.
Just so everyone knows, the examples that have have replied to certain posts are strickly life pay whole life policies. There are also 20 pay whole life policies where you only pay a monthly premium for 20 years which is better than life pay policies.
To anyone who has expensive insurances, ask for the cancellation form. Watch how your agent makes it hard and long for you to stop paying them money. Now imagine your beneficiary getting money from them. It is going to 100x harder
I don't have kids. But, I advised my sister's to buy term insurance. instead of whole or universal. That way if something happens to them while there still minors. There is money to take care of them. Once their grown, they SHOULDN'T depend on you, financially.
The sad part is sitting with a senior citizen who realizes their term is about to expire and now they're too unhealthy & too poor to afford anything with permanent coverage. All those years of paying term insurance but then it drops off & cancels on them. It's heartbreaking.
I've been in the business for 30 plus years and have never once witnessed the situation you just described RoslynR. Your comment suggests it's a regular occurrence. Nothing could be further from the truth. Mr. Ramsey is correct. Would you like to know what is really sad? Whole life and Universal life are products that have done more harm to our industry than the collateralized debt obligation debacle back in 2008. These policies do however pay huge commissions to insurance agents.
@@xJayhawkFANx Who is talking about health insurance? Why should some things not be considered an investment. Any time I can make my money back and receive a benefit along the way is a good idea to me. Where do you draw the line in what should count as an investment? I don't not deal with health insurance, I deal with life insurance. Yet I see health insurance as nothing but an investment. I have health insurance to reduce the cost of any medical expenses that come up. I spend a little now so I will pay less when the time come to actually needing it. To me that's a profitable return. Now with Life insurance it will definitely be profitable for the beneficiaries, the best part is when you can set it up with whole life and become profitable while your still living. Through interest and possible dividend growth you can reach that profitably level sooner.
I been following Dave a long Time. I think dave talking points are for people in a perfect world. Dave has great intent but unfortunately it's not the reality for the average person.
The problem with this conversation or the way most people buy either term or whole life insurance is that they don't view it as the tool that it is. Period. Dave talks about the reason middle class people are staying poor is because of products like whole life? Stop comparing a whole life policy to an investment...that's not what it is. It is a guaranteed storage vehicle for your money. Similar to a bank account. The reality is, a whole life insurance policy is not good for everyone. The other reality is that there is a reason whole life has a bad rap...most agents don't understand it. Always think about what the agenda is of the people who are telling you anything. I am an entrepreneur and biz owner. My whole life policy is the best financial tool I have. I can't sell you anything. Dave owns a term life insurance company and he has financial partners that he gets paid on when you buy into his philosophy...hmmmmm.... He always tries to keep the conversation very emotional. He does a good job of skirting around the details. I am going to get with my agent and have him do a video that I can share with everyone to give a real, detailed, technical understanding of each. That way you can make an educated, non emotional decision. I will work on having the video up shortly.
and here is another thing and Dave and I pointed it out in the comments Whole Life also called Cash Value Life Insurance is a ripoff do get it, don't touch it, and don't buy it it will put you into debt and your descendants will be stuck your funeral bill and they will have to pay an estate tax. Don't do that buy Term.
@@geomodelrailroader You only pay estate tax if the death benefit is left to the ESTATE which happens if both the primary and contingent beneficiary pass
Actually it's not a savings, because once you withdraw some money they will deduct it from the insurable amount. Like example if you die, your family will get $280,000 but if you withdraw 80,000. Your family will get $200k only since you withdraw the 80,000.
Idk. I have whole life. Been paying $139 a month since I was 31 (35 now). The way I See it. If I live close to about 75 and put about $66K my whole life. I would easily stop paying and let the cash value deplete over the remaining years of my life. I can pass on my face value (not cash value) to my daughters. Paying $66K for a return of 300K for my adult kids so they can build on wealth. I say that 66K for 300K was a good return in the end for my living family.
Get a 20 year TERM policy. Cancel the Garbage whole life. Do this ASAP. Your kids need to take care of themselves. They should not expect a windfall of cash when you die, anyway. If you invest $139 a month wisely, you will be fine.
@@kaohsiung99 yes, get a term policy that you'll pay on for 20 years and never get a thing out of since less than 1% pay out. Insurance companies LOVE term policies, they make a ton off of them.
@@KyleHurd Considering you yourself will never see a dime of any of it since, you know, you're dead and all? The point of term insurance is to pay cheaper premium when death is unlikely to be able to build enough of a nest egg that you are then self-insured. Life insurance isn't there to a windfall for somebody's kids etc it's there to replace income you currently make that your family depends on. If you have 1.5M or what not and a paid for home and are debt free how much income really needs replaced for your family to be able to continue on?
@@Matt-cr4vv you're acting as if the way you use life insurance is the way that everyone uses life insurance. I've been an insurance agent for 13 years and I can assure you that though some people want it to replace income a lot of people use it to create wealth for their family in the future.
I have had Whole life for my 2 kids for 10+ years, and just now realizing the waste of money it is. I guess I need to make some serious changes for this.
Don't cancel it, get a current illustration from the company who sold you the policy so you can see the returns down the road. Hopefully you got a 20 year pay and not a life pay, even a life pay could still make sense. 20 pays are good because you don't pay a time after 20 years and your balance keeps growing. Cancelling it could be the worst financial decision you make.
Do not cancel until you have another policy in force. What could happen if you cancel and then you die while in the process to get a new policy? It can be easier to get a new product with your actual company.
1st of all, do NOT cancel your policies until you have the right policy in force!!!! Apply for a TERM policy with a reputable company, then once you're approved, you can cancel the WL policies you were sold! (My company taught me to buy term and invest the difference, which is exactly what Dave taught about here! Their term policies continue after the term, but the insurance decreases a little-best term product I've ever seen!) Where are you located? They have offices all across North America! Seeing an "illustration" of a WL policy is NOT beneficial whatsoever! It's an illustration, NOT a guarantee, like a lot of agents make it sound like! Keep watching videos by Dave Ramsey and Suze Orman. Do the correct research, and your financial future will be bright, and you'll be miles ahead of the majority of people! Good luck!
@@cbdances4god your cash value is guaranteed. Your death benefit is guaranteed. What are you talking about. Maybe you went to some agent who ran illustrations with (not guaranteed) dividends factored in the policy
What did New Your Life pay in 2018, 2017, 2016, etc.? Maybe 6% on what was left over after fees, and expenses which are (naturally) meant to nullify andy increase in dividends. Insurance is not an investment it is for emergencies/tragedies only. New York Life is NOT Santa Claus.
@@102nightwing NYL has paid +6% dividend to its "policyholders" for over 20 years save two years. All cash value grows tax deferred and its compounded, which is huge. What Mr. Ramsey fails to tell his listeners is the wealthy have been using this vehicle for over 150 years to build and retain wealth. Making money is one thing, keeping it is another thing altogether. Granted, WL is not for everyone, and ALL companies are not alike. Do some homework, trust no one!! Best wishes nightwing.
@@102nightwing Investment - "the action or process of investing money for profit or material result." I would say if used correctly, Life Insurance definitely will produce a material gain.
@@peanutsandcrackerjacks Life insurance transfers risk. It only pays out if an untimely event occurs. Life insurance only produces a material gain if the person being insured dies.
The stock market paid more after accounting for taxes. Even more if you invested in Roth IRA. People just need to invest in S&P 500 for 30 years and will come out better than any policy
@@Godsdaughter530 don't be afraid. At Primerica, we do what's right 100% of the time! We only offer term insurance. Be afraid to be led down a bad investment for your money dealing with a whole life insurance policy from an agent.
Thanks for spelling it out for me. I'm literally sitting down to start value building for my grandkid, and was looking up whole life, and your name popped up on youtube. If i hadn't watched these two videos, I woulda bought it, put it on auto pay and moved on...
He sounds good coming from an investment standpoint but whole has its benefits based on age and health. You can make either sound good or bad if you’re trying to sell according to a narrative but if the agent or broker is really trying to help they will properly educate the potential client so they can make the best informed decision. Do your own research people. Don’t get me wrong this info is still valuable to know👍🏿
Another little item about that savings account. If you want to take money out of it. You have to play it back with interest. They try to tell you that you can be your own bank.
The problem with a term life policy is that once it expires you may be too old to get another policy at a decent price. There are various types of policies including Universal Life where the death benefit increases with the cash value of the policy. This video is misleading because it does not take into account individual circumstances, higher fixed rates, and various riders. Speak to a broker to get the correct and complete information.
That’s why you attached a retirement account alongside it so when it expires you become self insured because your investment accounts set so you become self insured, that’s why we call it buy term and invest the difference in Primerica.
@gregoryharris7174 If the goal is to leave money for your family members tax-free, then life insurance is the way to go. Retirement funds should be set aside for that purpose. However, there is no reason why you can't have both in place.
There are Pros and Cons for both types of life insurance. I don’t think there is a right or wrong choice. Whats important is knowing why you’re getting the coverage, or who is the person getting coverage. For example, if you just wanna leave something extra for your kids then a term would suffice. But if you’re not planning to have kids then a whole life policy might be a more conservative option. Because with the cash value available, you can choose to surrender the policy when you’re much older (usually about 20-30 years later) and get back your capital or a bit more. At this point it’d be as if you’d just left your money in your savings account for the past 30 years and now you need it for your retirement. The cash value for the whole life insurance policy in my country gives a pretty decent rate of return, about 2-3 times higher than what you would get from a high interest savings account. Most people aren’t that savvy when it comes to investing their money and it’s unlikely you’d make a profit every single year. A lot of people don’t invest their money at all for decades and end up getting peanuts from their savings accounts. And this is only one example.
The video clearly covers everything you mentioned. No matter how you cut it, whole life is a ripoff. You're paying for two products, but you only get one.
Not everyone is going to "invest the difference" even if you own a term policy. People just won't do it. What happens to people that have no assets, paid their term policy and the policy term is up? After the term ends your decision is either to hurry up and start building your stock portfolio, or turn to a higher priced term policy (since your term ended and they are older).
I have a permanent life insurance policy and my death benefit grows every year because I will get the cash value on top of my original death benefit. I started with 200K in death benefit and by the time I’m 65 I will have a 500K death benefit and 300K in cash I’ll have access to.
@@RuthABush major companies do provide policies that work like this, like Nationwide for instance. It's an "increasing" type of policy where death benefit and cash value increase throughout years. They just have to be designed properly since agents out there think about their commission first instead of the clients best interest.
Tell them the payout percentages of whole life vs. term. We make more money selling term than whole life, because the risk of the insurer paying whole life is almost 100%. The risk of them paying out term is almost 1%. When you by term you’re gambling with your life and you only win if you die. Please educate yourself before attempting to educate others.
There are many key points that weren’t disclosed or perhaps you don’t understand them, Dave I have a 52 year old male who took a $100k whole life policy 2 years ago to provide his family in case he dies (could it happen?) 2 years later there is a nice chunk of money and the policy has grown to over $102k death benefit tax free, investments are great too, they are just different I believe they can complement each other very nicely. Fix money and risky money perfect deal. Be smart goals are great but first take care of your priorities.
Get Both! Term for when you a actually kick the bucket, granted you don’t outlive your policy, cause then your family doesn’t even get a penny. And Whole so you can actually withdraw your cash value or borrow against the cash value which gives you a nice nest egg.
Thanks for all the detailed information you have provided in this video. I like your way of explaining every point. Keep sharing such great videos in the future also.
Had a relative who bought whole life with cash value. When his mom died, the insurance company only paid him the face amount and said that if he also wanted the cash value he would have to take them to court. Would’ve cost him more than the cash value in his policy if he took the insurance company to court. In the end, he decided to just take the face amount. All that extra money going into that policy wasted. Crooks I tell you.
Thanks for letting us know how this scam works. I see how this works now. No way in hell I’m getting this type of insurance. I meeting with my broker today.
As a State Farm producer with many other life insurance producer friends (not SF) I can say with full certainty that we have some of the best and most stable whole life polices. Period.
@@jalissas3152 thank you guys. I wish we could still see dislikes on videos cause I would dislike the shxt out of this dudes videos. sure he gives some good takes but overall he is a fraud and a liar only pointing out situational situations and ignoring the key points. just like CNN and the like, he is fake news
I honestly believe an update on your thought process of life insurance is well needed. It's been 6 years, and this is a very bold statement. You should reiterate if you still stand on what you have said prior to now. Life insurance is a very controversial topic. More than ever around this time period. May you please make an updated video?
I bought a whole life policy in 1992 for 100k from Metlife fro $103.00 a month. After 15 years, my cash value is 39,000.00. I also have 9K dividends that I can cash out anytime. I have only paid 29,000.00 in premiums. I made 19K and had protection sine 1992. What are you taking about?....
Try again. Go to yahoo finance, pull up a chart of S&P 500 index fund. S&P from January 1992 of around $400 to a low around $800 in January 2009. That is still almost a double (or not wiping out your gains) . Plus if you kept the money invested until today almost $2400 on the S&P. Easily outpacing your insurance policy. finance.yahoo.com/chart/%5EGSPC#eyJtdWx0aUNvbG9yTGluZSI6ZmFsc2UsImJvbGxpbmdlclVwcGVyQ29sb3IiOiIjZTIwMDgxIiwiYm9sbGluZ2VyTG93ZXJDb2xvciI6IiM5NTUyZmYiLCJtZmlMaW5lQ29sb3IiOiIjNDVlM2ZmIiwibWFjZERpdmVyZ2VuY2VDb2xvciI6IiNmZjdiMTIiLCJtYWNkTWFjZENvbG9yIjoiIzc4N2Q4MiIsIm1hY2RTaWduYWxDb2xvciI6IiMwMDAwMDAiLCJyc2lMaW5lQ29sb3IiOiIjZmZiNzAwIiwic3RvY2hLTGluZUNvbG9yIjoiI2ZmYjcwMCIsInN0b2NoRExpbmVDb2xvciI6IiM0NWUzZmYiLCJyYW5nZSI6Im1heCIsImFsbG93Q2hhcnRTdGFja2luZyI6dHJ1ZX0%3D
And that’s why i got my life insurance license with Primerica, and will never ever work for another company. I will never sell that crap to decent person, working and taking care of his/her family future. Buy term and invest the difference is the best way to go. It’s not easy to deal with some people who are afraid or misunderstand my company’s philosophy, but I feel very proud of myself and go to bed very confident I helped a family which the right product.
@@johnd9541 In a $500G DB example, the premium is $430 a month from age 40. Nick lives to age of 90. So with whole life insurance, Nick pays $430 a month for 600 months (50 years) total $258G. Dividend is $130 a year best case for 50 years on the premium paid, or $6500, for a cash value of $264,500. The alternative is to buy term life insurance with extended duration and invest the rest .. a $500G death benefit policy for a 30 year term would be about $60 a month leaving $370 available to save .. $370 monthly in the market at 7% (stock market lifetime average) in a tax deferred account gives me $432G after 30 years. I won’t need a $500G policy if I’ve got $432G cash in my account, so I cancel it, And for the next 20 years my account keeps growing at the full $430 a month. when I’m 90 the account is worth $1.9 million. Conclusion is clear .:. Do I want $264.5G (whole) or do I want $1.9 M (term and invest) for the same premium output .. I choose term and invest!
Its convenient to put everyone in the same group. Life events happen, wealth may or may not be accumulated and term may or may not be an option or affordable later in life.
@@chrisstaub5880 I disagree, most people do need it. Now if you're talking about middle class families then its not really a question of whether they have the assets or not, it becomes a question of where are the funds coming from?
@@jeremyed9507 I'm not talking about middle-class, I'm talking about everyone. Life insurance should only be needed as a means of helping to support others who rely on your income, such as young children. Anyone who has no longer has any dependents, no debt, and a good amount of savings/investments has no need for any kind of life insurance, and most people are capable of reaching that point. Now, if you're talking about someone who is already older and hasn't managed to save anything, it's quite possible they may still need it just to pay for burial expenses and leave something to their heirs. However, I believe that most of those situations are a result of poor money management earlier in life, so most people have the ability to prevent it. They are plenty of ways to ensure you leave a decent inheritance to your children, and it's usually no one's fault but your own if you reach the point where life insurance becomes the only way to do that.
@@chrisstaub5880 The point is that blanket statements don't help anyone here. You think of life insurance in terms that make sense to you but it is just a tool. Use the tool as it best fits your circumstances and move on. As far as what people are capable of and what actually happens...well.
Wow, this video was really informative! 😍 I'm so glad I now know the benefits of term insurance. Thank you so much for explaining everything so clearly! 🙏
I almost got "tricked" into selling whole life as an insurance salesman, or 'representative' as they labeled it, for a large mutual financial services org. Learning more about the ethics and scheme of 'WHOLE LIFE' as a product disgusts me. You have to wonder; how can those salesmen live with themselves knowing they've sold someone a garbage product that has considerable life consequences? I could not do it.
I have heard that with term life policies the premiums go up a lot after the initial term, whereas with whole life policies the premiums never go up (they're "locked" in). Is this true?
It is true, but the real question here is how long do you need insurance? You can buy term up to 30 or 35 years depending on the company. Let's fast forward35 years... are your kids grown? is the mortgage paid off? have you been paying yourself first for 30 to 35 years? Are you investing with a IRA (Roth, if possible) or 401k to get the employer match? If this is all yes, then do you have a need for insurance three decades from now? And funeral costs? If you have $500k cash, I am pretty sure you can pay for a funeral.
YUP! Also term once its done 20 years wtv you have to re-apply and guess what your health condition most probably isnt the same 20 years ago! Think about that!
Nick Pallotta wrong no medical qualyfication required So you mean you would like to be robbed your whole life? Bring your policy to someone to really explain it to you instead of just asuming. Save money from the begining of your policy so you dont need it. Any more but save separated from any life insurance.
The best life insurance is the one that is in force when I die. Tax free to my beneficiary. Permanent insurance says that when I die the death benefit WILL be paid guaranteed. Term insurance says that if I die WHILE the term policy is in force say 20 years it will pay a death benefit. Most people's term insurance runs out when they NEED it most. And if your health has changed you cannot qualify for more. Dave is being hypocritical about buy term and invest the difference he never mentions losing money to stock market risk. Permanent life insurance is all about guarantees with NO market risk. Think about it and use your brain Dave has made a ton of money criticizing whole life insurance. I do like his debt reduction snowball idea. Dave knows permanent insurance has its place in your portfolio he just won't admit it. Term insurance is always good but don't bad mouth permanent insurance. KR 39 years as a life insurance agent.
@@ProDVIet93 brah... you don't even know. many of us are good people that have conviction in what we do. I tell my clients I would never write a policy in bad faith.. & I mean that
What’s wrong with a credit card if you pay it off every month? I haven’t had a credit card balance go unpaid in over 30 years. However, I use a credit card for 99% of my purchases. I get a lot of perks with it. What’s wrong with that?
The problem with Term is better, is many people are finding themselves old, sick and uninsurable. They have outlived the term policy, have not built wealth along the way, and will die with no insurance. I believe having a combination of permanent and term is wise.
SMART investors Jimmy and Janice: 1) Buy two 20 or 30 year term insurance policies, for about $80 to $120 per month for BOTH policies at $500K coverage. 2) Two years later, they saved enough for a down payment and can easily afford $1500 a month for the payment. 3) Jimmy and Janice now have a tax write-off and their house keeps appreciating. Jimmy and Janice also enjoy living in a house instead of an apartment because of all the noisy at night. They sleep well
STUPID investors Bill and Betty: 1) Buy two Cash Value Life Policies ($500K) at $500 each or $1000 both per month. 2) Two years later they want to buy a house, but cannot afford $1500 per month for their house payment PLUS $1000 per month for their Life Insurance. Problem is they cannot stop paying on their policy or they will lose their contributions by paying a huge surrender fee. 3) Bill and Betty continue to rent.
Lol Terrible scenario the right one would be... Universal life policies 100k each and the rest term joint first to die 30 year policy when they purchase a home.
Carol Cherry that is why Dave stressed the baby steps. Also, if you outlive your terms and find yourself old and sick, that would normally mean you don’t need any insurance at all. Insurance is for when someone depends on you completely for an income “breadwinner” when you are no longer in that position insurance is not needed.
I’m not sure how all life insurance companies set their polices up, but with State Farm a whole life policies face value grows. So yea you won’t get your cash value if you die, but you get the face value which grows very quickly. A 100,000 policy for a 26 year old would be about $100 a month and by the time they are 70 it will be about 170-180k. I think Dave might be right speaking in general but I don’t know if he’s actually searched through every companies policies because they are absolutely not the same.
That is Ill advised. The cash value is there to hedge against the mortality rate which is what keeps the cost of insurance down (or fixed) as you get older. The cash value at death is built into the death benefit. That’s why if you turn on income (or annuitize) the cash value the death benefit decreases. If you get with the right advisor term or whole life can properly positioned. A poor advisor for any financial product can cause more harm than help. The policy is it meant to pay an agreed upon death benefit. If it does as stated then every party received what was contractually obligated. Insurance and Annuities come with contractual obligations that are mandated federally and by the state.
The cash value is only a an account that is used to build funds that hedge against the cost of insurance. The older you get the more insurance cost because you are closer to death. When you buy insurance, you pay a smaller amount for a larger amount in return. Instead of the fees continuing to increase every year the cash value account saves funds that are used to essentially buy down cost. The funds are directly tied into the death benefit or the benefit that is paid out. If you take funds out of the CV account it reduces the death benefit. As the CV increases the death benefit increases. With that understanding the CV account is not separate from the death benefit they are one and the same. So, when the insured member dies, the funds are paid to their beneficiaries. It is not a separate payment it is an inclusive payment. If coverage is 100,000 and you borrow or withdraw 30,000 from CV then you get a death benefit of 70,000 if you have not replaced the funds back into the account. On the other hand if you started with 100,000 in coverage and your CV builds 30,000 in cash your coverage amount will increase. How much it increases or when it increases depends on the type of plan you purchase. The simple answer to your question is the cash value and the death benefit are paid as one payment which is your death benefit or face amount. The benefit of the Cash Value is that you don’t have to die to use it or to access it.
@@darrickharris5534 You're lying. When the person dies, the DB and CV are not "paid as one." The person's beneficiary only gets the DB. The rip-off company KEEPS the CV. Stop with your double talk nonsense. The best thing about youtube is that it shines a light on you cockroaches who want to steal from the less-informed.
astroman30 you know nothing about me for one. Two there is a contractual agreement when you buy life insurance. Everything is in writing. You put your money into banks that pay below 1% on ROI, you will put your money in high risk investments like stocks with no guarantees, but criticize the only product that gives you guaranteed growth and coverage? I am not a liar at all. All I did was provide the information. There were no bias in my response. You can choose to research and be educated or not. Just like anything else, different strokes for different folks. If it is not for you then don’t do it.
@@darrickharris5534 Stock market is at an all-time high. Again, the rip-off insurance company KEEPS the CV in the policy when the person dies. The family only gets the DB. Stop with your lying that the family gets both. People, please cash-in your WL policy. People who sell this garbage are scammers.
When you policy starts to build cash value your death benefit definitely increases if you don’t pay out the dividends.. and being ill and uninsurable isn’t stuck you’re safe and your parents took good care of you.
People aren’t smart enough to know who to listen to. Why would anyone listen to this man when it comes to life insurance? This man knows nothing about life insurance. He should stick to teaching people how to stay out of debt and leave the life insurance advice to professionals who actually do this!
I have written down all of Dave’s pros/cons and I understand his point of view. However, one thing he never mentions, is that on term - you outlive you’re policy and get nothing. In whole life, the death benefit is guaranteed. That makes playing term for 20 years a terrible investment if you outlive it. We never discuss that, and I don’t understand why.
I'd suggest not to trust blindly neither Dave nor IBC/WL (infinite Banking Concept, which tries to benefit off the Whole Life policy Cash Value) videos and literature. Schedule some interviews with agents, explain to them what you need, how would you use Cash Value, Loans... and ask them to provide you with their options (called Illustrations). Then, create your own illustration on investing in some other vehicle (IRA, stocks, RE, 401k...), but be as detailed, realistic and accurate as you can be (accounting for realistic gains, taxes, fees...). Then - compare the two (IBC/WL vs. your vehicles) assuming the investments of the same amounts (from your pocket). Look at how they are comparing in short term (5-7yrs), mid term (10-220yrs) and long term (>25yrs). I've done several interviews with IBC/WL practitioners and build out very detailed spreadsheet for my own investments. I'm still searching for the IBC/WL policy that would beat my projections, yet I CANNOT SAY that IBC/WL with all its fees and complexity is grossly under-performing. It delivers less growth, but one of the benefit of if could be low risk and stability. Basically, once you have your policy, you are on auto-pilot, unaffected by the markets, interest rates and your time to (not)spend on active investments.
I sold Life Insurance and bought whole life myself, for my brother and wife. After almost a year of my returns were almost nothing after paying $500/month. My wife and I cancelled our policies and told my brother to cancel his as well. It's ridiculous how such a ripoff whole life insurance is. I felt so bad for ripping my family off into this garbage.
So for how many years did you sell life insurance? Why did you sell life Insurance? What did you expect, its not an investment. Its income protection and risk transfer? I am willing to bet you had poor training.
@@sethhiggins7783 I only sold it for about a year. The training I had was terrible. They taught us to sell the whole life package from Transamerica called the FFIUL. We were told lies about how great it was with all these riders and how we can grow our money tax free and at the same time protect our families. It just didn't make sense paying $500/month for a whole life package, seeing very little to no returns at all, when I can be getting a 30yr term policy for a fraction of the cost as Dave mentioned. So yea the training was bad in a sense that they taught us that we can use the whole life package as an investment. They showed us the average return rates on our investment and it was no where near what they showed us. I worked for the pyramid ponzie company WFG.
I went from paying $20/mon for $20K in term coverage to paying $26/mon for $100K in whole life coverage. So this confused me a little bit. The term policy would have ended in my 40's, had I kept it. If I still wanted to continue coverage at that time I would have had to get a new policy and pay an even higher premium for it, since I would have been in my 40's instead of my 20's, as I was when I took it out, wouldn't I? And if my health had gone down in the meantime? I've had the whole life policy for 17 years this month, so I currently have $5302 invested in this $100K policy at 53 years old. That's considered a bad investment? At this point (my son is now grown) a better option might simply be a pre-paid funeral plan, if I could afford that, but at the time I was a single parent with a child (whose other parent was a deadbeat in hiding who had nothing to do with him), so that seemed like a much better option to me at the time... 5 times the coverage for $6 more per month.
You did good, I look at it as a bonus bet but for my loved ones incase I got a bad roll in life. Also you can use that $5k you invested and pay it back as loan I believe and it should still be collecting your % interest as if it was still there. Make sure you check with you agent on all this. Also average funeral cost is 9k so you wouldn't be able to pay for it. The whole increase in premiums as the years continue is interesting..
@@Ben-tr Message me back. I have some awesome options s for you. Have you heard of an IUL policy. I can definitely help you Sir. Looking forward to speaking with you.
Insurance is not a bad deal. You pay a little to avoid a small chance of a big cost. Whole life insurance though is a scam though because the money saved from only buying term is money you could have invested at a higher return.
My boss was a very wealthy & financially successful man. He told me : " Anyone who comes to you to sell you something is there for THEIR benefit, not yours."
Life insurance is not investing. Life insurance replaces income. If you can’t save five years of your income then you can pay premiums to “ensure” your income is there for your family if you’re absent. If you’ve paid in $5000 and your loved ones get $15k that’s pretty good if you ask me. That’s why I have it. I love Dave Ramsey. This is my only issue with his coaching.
@@thomasscialla1115 paying $400/monthly premiums on a trash value policy is stupid for just burial expenses. I would save up my money and pay cash, or, pre-pay my funeral. Try harder
@@astroman30 I would never recommend that anyone pay $400 a month for a policy just to cover their burial. I don't know who tried to sell you that "prison love" policy, but you were right not to buy it. However, 99.9% of burial policies don't cost $400 a month. Most are well under $100 a month. Why are you so angry?
this guy only looks at everyone as "the same" we are not all the same and we talk about returns. returns are better. zero cost loans exist he knows that. in fact arbitrage exist too.
Life Insurance is only great when you get them when you are young and you have no health issues. My wife and I, we got our life insurance extremely cheap (in our early 20s) and enough to pay off our house if one of us passes away. Between both of us, we pay under $75.00/mo. I would never get a life insurance at my age now, 41. The monthly payments would be outrageous!!!
You choose your investment structure! Conservative, balanced or aggressive funds. If the markets are doing great your policies pays for itself...I wonder why Ramsey didnt mention that aspect.....
True it is best to buy when young and healthy, but if you are not financially independent, you do need it. The true meaning of life insurance is income protection, because it is your income that pays Fir all the the things you have. It is for those who are left behind. High quality term along with investing would be the way to go. As far as cost you have to decide on the value of your loved on es to you and your budget. Peaoplw seem to have money for everything else other than their loved ones
@@shadowrealm7858 Because insurance is not a true investment . vehicle. That is not it's purpose. It is just a trick. Why would you settle for those so called me as key rates of return, when you could invest in mutual funds averaging 10% and above. Save yourself
Here's why a permanent policy is better than a term policy: 100% of permanent policies pay out, term policies pay out at a rate of less than 1%. Term is a great product if it's all you can afford certainly. However, that extra "$95" you are paying into opens up a product that allows you to manipulate it as a tax shelter, provides cash value via dividends, protects you for your entire life, and so many others. What happens when your son gets cancer? Oh we'll just pay for the treatment with cash right Dave? That's where the beauty of a permanent policy can come into play, take a low interest loan or cash out your policy tax free. 100% of people die, 1% die within the term of their term life insurance policy with their family collecting the payout. Google it.
![[MV] A leap of faith...ความเชื่อใจครั้งสุดท้าย (From "Petrichor the series")](http://i.ytimg.com/vi/U1piZH2CNXA/mqdefault.jpg)
I used to work in a call center for an insurance company. Day in and day out, we get phone calls saying, my father/mother paid thousands a year for this policy for decades and now they die and we only got 20 grand???
Hated that job, worse than Walmart.
Hidden Secret Healing, LLC that would be a whole life policy
@@Hollablackgirl93 In that case, you'd want decreasing term. If you're protecting a spouse, you might a level benefit with an inflation rider.
Those people don't know what's on the contract cause they are just beneficiaries acting like they know everything about it.
How do I get an Life insurance company to pay me, that I have a had a waiver of premium- due to disability, on it. I took this Policy out in 1998, and now it is 2020. I have let them know that I am now totally and permanently disabled. They have sent a letter to me saying I don’t qualify for this waiver of premium; even though I had not missed a premium payment. My policy is for $180,000. I can no longer easily pay the high premiums. I do not want to surrender it. As I have paid a lot into it. And I still have a mortgage and I am not able to continue to pay the high premiums. The letter they sent me said I had the right to appeal this decision for one year. Which would be another 6 or so months to be able to appeal it. Must I obtain an Attorney to do this appeal? I don’t have the money to hire a good Attorney, but feel that if it is my only chance to make this company pay my premiums, only until I am 70; I am 56 years old now, it may be worth it to borrow the money to appeal if I have a fighting chance to win the Appeal. Any suggestions on what I can do? I appreciate any input! Tammie Printz - Company is out of Minnesota- was called Minnesota Life; now goes by Securian.
@@tammieprintz3975 who you have it with
Thinking about my retirement scares me.I apologize to everyone who is retired and filing social security after putting in all those years of work just to lose everything to a problem you weren't to blame for.it's especially difficult for people who are retired.
Indeed, It has always been more difficult to understand how to build your money after retirement and even more so right now with the inflation. You can experience a completely varietied market passively by employing a successful portfolio-advisor.
Even with no skills, it is still possible to hire one. I was a project manager and my personal portfolio of approximately $850k of my retirement pension took a big hit in April last year due to the crash. I quickly got in touch with a financial-planner that devised a defensive strategy to protect my funds and make profit from my portfolio this red season. I've made over $250k since then
Mind if I ask you to recommend this particular manager?
“SONYA LEE MITCHELL” is the licensed consultant I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
I copied her whole name and pasted it into my browser; her website appeared immediately, and her qualifications are excellent; thank you for sharing.
Term policies are around 3X cheaper than permanent life insurance on average because the chance of a payout on behalf of the policyholder is less likely and 99 percent of all term policies never pay a death benefit because policyholders either stop paying premiums or outlive their term period. So the answer is: term and permanent life both have their upside and downside - you decide which suits your needs better or perhaps a combination of the two types of life insurance.
I purchase homeowner's insurance every year and never made a claim. Does that mean it's a bad purchase? NO!!! Insurance should only be purchased for RISK MANAGEMENT purposes. Trash value insurance is never a good buy. Letting an insurance company invest your money is beyond stupid.
Buying a universal life policy before age 60 with premiums guaranteed level to age 100 or 105....not too shabby.
@@Gogalen789ULs are worse than whole life. The cash cash value gets eaten up by all the fees/commissions leaving people to pay out of pocket for the ever increasing A.R.T. (Annual Renewable Term.)
Never could figure insurance. Dave's help in figuring this out has been financially revelatory.
I sell life insurance and I only sell Term life. The only time i sell whole life is if ive exhausted all efforts in swaying them to term. in 2019 I sold 90% term and 10% whole.
@@dakotadak100 it’s not
@@dakotadak100 andrew fiore sells whole LOL honestly idk what is true
I worked for New York Life in Tampa Bay, my job consisted on calling back beneficiaries to burst them the news that after paying to us premiums for possibly multiple decades, NYL's underwriters came to discover after the investigation that the insured had a health condition that was not disclosed at the time of signing the policy, and even though the commercial on tv that lured them to by the policy indicated that not medical exam was required, an undisclosed health condition wold be sufficient for any insurance company not to have to pay a single penny, I hated my job and quit because I could not longer be an accomplice on ripping people off their money! Life insurance companies are worse than car insurance!
Amen!!!
Wow thats horrible. I tip my hat off too you.
Bingo. That is what i am talking about. They are money making fraud
@Sherlock’s Redbeard Life Insurance is important when someone depends on your income. Most important if you have children. But best to buy term life insurance and at the same time invest in stock mutual funds. I started with $166 a month.
@@guitarcountry1, you’re telling that because you don’t even know how to have a custom while life with max funding, PUA, living benefits, chronic care, accelerated benefits riders. It works almost same as a mutual fund but your money is secured.
I have learned more in this video than the past 10 years watching/listening to others...Thank you!
100% agree about credit card company being a scam 20% interest to Capital one, I experienced it and never again will have it. If I don't have cash to pay for it then I don't need it.
Using the card as if it’s a debt card means you never carry a balance and always get paid to use it. It’s about the action you take
Some folks aren’t smart and not informed well about credit cards. We only use credit cards in my home and have made lots of money (cash backs) over the years. We pay off all balances before interest rates kick in. Facts are that some folks will always default and my cash backs are paid for by these kinds of folks who don’t understand credit cards.
This was a sign.. I literally had a meeting with someone about them tryna get me and my wife whole life insurance .... thanks Dave!
Me, too. This guy had me convinced and then I see this.
Are you still looking by any chance? If so my office is doing free financial game-plans for families for the rest of the month through zoom. Would love for us to talk.
Honestly, if your young and healthy, whole life and term is a great way to go. You will out live term policies. And the more you renew, the more expensive it becomes. Whole life is level and will never go up in cost. My sister got a $100,000 whole life police for $67 a month. And thats honestly outstanding. I’m an agent. And I’ve seen people from 60 and up that only qualify for $10,000 at double the price. And after a certain period, you can borrow up to 75% of your payout to use as you want. They will only pay out the 25%. I always tell my clients “ if it doesn’t make sense, don’t buy what I’m selling. I’m here to help. Not harm. “. I’ve studied and passed my tests. Dave is a very smart man. But, I disagree with him on life insurance. Term is temporary.
@@MrScarletspider99 I agree with you💯
@@EshhhaBenjamite I don't
My argument for keeping or buying whole life for a child - the earliest you can buy it the better due to low payments. They can be $10-$20/month and that is the set price. If you are blessed with having a child who reachs their 20s or gets married you sign it over to them and most likely there are no payments that are needed. If in the time between when they could be insured and adulthood they found out about having cancer, deadly allergies, epilepsy, or they smoke like a chimney or skydive they at least have something. I really wanted to buy whole life for our children but didn't. We found out our youngest has a bad but allergy and possibly sports asthma making things possibly harder in the future for getting a good deal on term.
Keep that thought process in mind because whole life intern life does have pros and cons both. What you just said is a real logic way to get some straight life insurance 🔥. at the end of the day people are paying $15 to ensure their cell phones.
I love the honesty and how educated he is. My coach educates and trains us daily and I am so grateful I work for a company that is truly for the ppl. Buy term and invest the difference! That's how you and your family WIN🎉❤😊
Look up IUL and you’ll never do that term and invest the different ever again 😅🤷♂️
guess he wants you to invest in stock market. The most risky of all investments. People be diverse in your approach.
@@IAmFergI keep hearing about IUL but not really understanding it. Is IUL just good for investing or people who are into real estate? Or is it helpful for is a family member die, it will cover funeral costs plus give each family member a 10k check?
@@TimeisUp22 IUL can be used for both family and investments because in an IUL your money is always growing with you having full access tax free on top of the insurance. What makes IUL’s suck is Insurance agents can be greedy and fund them INCORRECTLY giving the agent more commission… that’s why people have mixed emotions on IULs but a IUL funded correctly is 100% best product on the market.
I love the truth and I really appreciate you! Honesty to people life is the best policy! You right who cares wat they say about you! Atleast you are helping us poor, middle class people! Thanks for your honesty! 🙏🏼🕊️❤️
I've sat with people who were A.L. Williams clients back in the 90's. They bought into the "Buy term and invest the difference." Well unfortunately over time they ended up SPENDING the difference. Sometimes it was lack of discipline, sometimes it was a job loss or divorce or something they couldn't have foreseen. So now they're starting over financially but their term is expiring and they've got medical issues that all but make them uninsurable. A permanent policy would have prevented that. Insurance shouldn't be your only investment platform, but you need a policy that will be there when you need it. Permanent insurance will do that.
People always spend the difference......bigger car, bigger tv, nicer restaurants, better vacations, etc. Its just human nature.
Investing the difference saved using term, or even investing all what a whole life policy would cost and foregoing insurance completely, is not going to make anybody financially independent. It might help fund a vacation or two but then what? The best way to financial independence is to get a good education and to move up in your job, or to learn a trade. The fast track to debt is to join an MLM and peddle insurance to friends and family.
While a little man can't get ahead, it serves them no purpose to get further behind by joining a MLM opportunity.
@@johnd9541This is poor advice.
Your dumb as hell and clearly have not done your research, Primerica offers a policy extension without a med exam
This is just what I needed to hear! My broker is pushing me to go from 'term' to 'permanent'.
Thanks for speaking the truth, not only about the life insurance, but also the car lease and credit card!
Thanks, Dave for this video I have been taking to the cleaners with these insurance scammers. I will not never get a whole life policy again. Thanks a million, Dave.
Common. A credit card is not good ?? Give me a brake. I got 0% APR credit cards that I play with and because I have great credit. No annual fees. And if it wasn’t for those I couldn’t have grown my business. Never paid a penny in interest. The cards are not a problem. The problem are uneducated or irresponsible Spenders.
Break*
@@agravy7657 I laughed really hard when I read your response.
😂😂😂
Agree. What I notice is that Ramsey and others do not make clear is that Most individuals should not have credit cards as they are not responsible financially and probably in other matters (personal, relationships, etc.). Broad- brushing is usually not accurate.
I understand but first off 0% APR(after their promo period)? Be real. I have a 800 credit score not even I have 0% Apr credit cards. But anyways this information is for the average Joe. You have to be extremely disciplined to play with credit cards and win at the end. I myself stopped using cards only debit bc it just simplifies my life.And is very easy to disconnect yourself from real money. And just one day swipe on a big purchase. Just for some points.
Whole Life Insurance has left the chat.
Stick to used car salesman Dave’a advice and ultimately still blow tens of thousands on a cheap term policy you’ll statistically outlive and have nothing to show for in the end.
@@matthewmcguigan552 Agreed. It's funny how Dave never mentions that only about 3% of term insurance ever pays out. Companies who sell term are making a statistical bet that the person will outlive the policy thus never having to pay a check to the beneficiary.
@@Roslyn111 Yet, it's still better than Whole Life that rips you off by keeping the cash value.
@@astroman30 what are you talking about? There is certainly a need for whole life for some people. What is the most tax efficient way to leverage your money? How do you keep your estate most intact?(inheritance tax, probate fees..) this guy says that there is NO need for whole life ever. Which is completely wrong. This guy gives terrible investment advice
@@kawi4ev You're just a lying salesman who refuses to accept the truth: Whole Life insurance is (at least) 20 times more expensive than term in premiums. Oh sure, you're promised permanent insurance and a glowing cash value. Yet, the only way to get money out of CV is to borrow against it or cancel your policy? The average ROR on your precious cash value (after fees/taxes) is 1.5% Complete garbage.
I have a whole life policy. I pay $43/month for 40 years for a $50k policy. So in total I pay about $21k in premiums (unless I die sooner, in which case I'd pay less), and I get at least $50k (I could potentially get more depending on dividends for the policy that aren't guaranteed). So it's not a great investment obviously, but I don't think it's fair to compare it to having a credit card or a payday loan. I mean it does make money instead of being given away to the bank...
If my calculations are correct, this is a 4% return per year. It's not that bad, but I think Dave's point is that there are better investments out there that could be earning you 6-10%. For example, suppose that you switched to a term policy that was $5/month, and invested the difference of $38/month in a fund that earns 7% per year. That fund would have $106,276 at the end of the 40 years.
Also, if it's whole life, how do you know it's 40 years? Don't you pay it until you die?
I'm no expert at this stuff so take what I say with a grain of salt.
@@vinnv226 That's exactly the reason why whole life is generally a bad deal.
Was your policy designed for high cash value?
@@vinnv226 However, you are not calculating management fees, capital gains tax and estate costs after death
@@juanzapata7701cash value is a SCAM that’s part of the point of the video because it’s your “investment gains” that you can’t take out unless you close the account or borrow against it and both hurt or eliminate your death benefit. Moreover the “gains” are shit compared to a mediocre index
Credit card is good only if you can pay off the balance every month, not just pay the min. Payment +over 20% annual interest, which will drag the payments forever.
Why would you use a credit card if you already have that money saved in your bank account?
@@truckerstar24 They say for the perks. I’m speaking from hear-say. Not from experience.
@@truckerstar24to build credit and to get the 1% back or points or whatever bonuses your card gives you. Why would you use a credit card if you don’t have the money to pay it right back? Not to mention then you definitely don’t have the money to pay interest
Well, you can maintain your checking account cash reserve without blowing all your cash. Basically, you can if you have too tier credit take out S1 to 2 thousand dollars out of your credit card feature, Called a balance transfer, then pay off the 0 percent balance in 12 months.
I tried scheduling a payment on a credit card to cover something I had just purchased with it, and it would not let me schedule a payment until the next billing cycle completed. They make it as hard as possible to keep up on payments.
This was the best explanation ever. As a former insurance agent this makes me mad i used to sell this garbage. I’m cancelling my policy and going term!
Dave only 1% of term insurance is paid out, the problem here is that most people don't invest properly or at all; so when they need the insurance the most they don't qualify for a new policy or the term policy has run out. People go into serious debt when they get sick or have an illness, in permanent policies you have the ability to access accelerated benefits while you're still alive, which can pay for your medical bills and other expenses to keep you out of debt.
A 22 year old can pay $200 a month for $500,000 benefit, if the 22 year old paid that for 80 years that would be $192,000 put in with a return of $308,000 with the ability to access the health benefits in time of need. You are trading a smaller number for a bigger one.
Exactly, and I see many very wealthy, educated parents buy 10 pay or 20 pay life. The child could cash out for college, carry the insurance for life. Or in a worst case medical emergency, they could take an accelerated death benefit.
But you still borrow the money and have to pay interest on it
🗣Bingo!
🎯🎯🎯🎯
@@Anonyme67 In alot of cases this is better than the tax liability you get when cashing out investments
Thanks to your advice I got rid off a whole life insurance that was squeezing my finances... Thanks a lot
Awesome!!
I worked as a Financial Advisor and I agree that whole life insurance is a rip off.
You see that's the thing, you were an FA, not an insurance agent. Only a well trained and educated insurance agent can communicate the benefits of life insurance. Whereas an FA will probably have a bias towards investments, which is fine, and also very different.
Your FA title didn’t make you immediately educated on how life insurance done right is by far the most superior financial product that was ever invented. I know many former FAs who are LI experts now because they learned how much of a rip-off most financial planning is.
@@jaydennis1999 Insurane agents ie to consumers every day. Folks who sell Cash Value policies are the worst.
@@Sideler74 nice baseless claim with no evidence behind it. Good job, keep going!
@@jaydennis1999 tell the truth you snake oil salesman.
Term insurance works better for middle class. You buy a term, and invest everything else to 401k, IRA, Roth and all other Index funds. Over 50 years, index will overrun the return from whole life by at least 200%. Whole life is good if you already max out everything else first and of course it is tax benefit to leave wealth to your beneficiaries.
Thanks Dave Ramsey I can't sleep now thinking about the extra I've been wasting on whole life when I could have put the extra into a simple mutual funds account and earned more over the same period of time..lesson learned and thank you I am forever grateful
He is not correct
My nephew got sold one of these... he has no kids and isn’t even 21 yet... his girlfriend called it a savings plan... I told them that these things are highly criticized and suggested she look into why they are bad... she said she looked into it and that the critics said that the plan they went with is one of the better ones but she could not communicate with me why they are critical... so in essence she got sold s bill of goods and does not want to think she made a bad decision... and of course the person who sold this to my nephew is someone from her family so that bit of psychology is working against my nephew
She made a great decision in getting a whole life policy, message me and I will gladly give you the full breakdown as to why this was a good idea.
@@caseyhickey6793 boss I get universal life insurance is that ok to get I’m 26 years wat u think?
Your nephew has a great policy. I am a fiduciary and my daughters have had their own policies since they were 2 and 3 and it’s the best thing that they could have aside from their college accounts.
@@jreavestheleader8255 Dont't get any life insurance! It is a complete scam! Anyone who tells you to buy life insurance or tries telling you its a good idea does not know. You're 26 you have many more years of working and saving. Invest in something that will build equity and give you a return in the future that YOU have control over. Invest in the S&P 500, strong companies on the stock market, real estate, gold, silver. Buy and hold thats how Warren Buffet became rich, Buy and Hold. Life insurance only benefits the life insurance company and the salesperson who sells it. Make good financial decisions my friend. Cheers.
Vultures
Life insurance is the most efficient way to transfer wealth from one generation to the next. Having a solid permanent life insurance plan in place makes great financial sense when part of your goals is to leave something behind regardless of what you statements say when you die.
Thomas Healy No it’s not. Just save your money and write up a will.
Kyle Zawacki not even close. Life insurance as a death benefit will always be worth more than an investment. It’s as simple as that.
@@healtc5069 Nope, totally false. Most investments will outpace a cash value life policy in value if allowed to mature. The math is pretty simple.
Thad Lozensky explain the math please.
Thad Lozensky I’m still waiting on this “simple math”.
I listened to your audio book on kindle, the total money makeover......changed my life.
Everyone should learn finances
I'm so glad you made this video. This is all so confusing. Thank you for helping me understand!
Thank you for saving me from a horrrrible investment Mr. Ramsey! I'm 19 and am diving head first into financial freedom and had convinced myself whole life was better. A school teacher had told me you get cheaper premiums if you take out your life insurance when your younger and keep it you whole life but this benefit would not outway the huge premium price difference between term and whole life insurance. Thanks for all your knowledge!
Tatum, you're going to pay for them insurance for 30 plus years and never use it....
Less than 1% of term policies pay out.
Tatum look into universal life. Please.
Yep, Term life is you literally giving the insurance company free money with no risk to them because they know the odds of your family using it is near 0%.
But whole life insurance gains tax free dividends up to 8% a year
Tatum, Dave Ramsey is right on this one. I'm in my 60s, retired, and never had cash value insurance. So I have been through the life cycle. I had term life insurance for 30 years. Very inexpensive. I invested $2000 a year ($166 a month) into mutual funds all those years and I can tell you this is the best plan. So glad I didn't buy cash value life insurance.
@@guitarcountry1 It's one path. Permanent insurance is another. Consider that you would have some accumulated amount of cash value, no further premium payments to make if the policy was structured that way, and still a death benefit intact to pass off to a beneficiary. Why would that be worse?
Get with a proper company that is financially stable. Be fully educated on how whole life products work and function. They're the most flexible asset out there. Again, contingent upon the company you are with. There's not a lot of companies out there that can actually do what they claim whole life can do. Be educated. He's not wrong, but he's not right.
Would you mind elaborating?
Well said. Anyone who says that whole life is a bad thing doesn't understand the mechanics of life insurance, and anyone who says that there's no such thing as a permanent need for life insurance knows nothing about financial planning.
Please give examples of the financially stable companies worthy of getting their whole life insurance. I am interested.
My entire family has always gone with IUL. Maybe I’m not getting it, but the example that Dave gave about being paid only the death benefit $15,000 and the insurance company taking the cash value/growth after years of contributions is only valid if you took a loan from your policy. The cash growth is collateral on the loan you take. I know this because my parents got the entirety of death benefit and cash value when my grandma passed. Never took a loan or anything.
Good thing I figured this out today 9/22/23 after our second annual payment for my kids, I’m getting term life insurance and canceling this whole life immediately, this is a game changer. It will save me thousands in the long run. 😧😧😧
Once again, thanks, Uncle Dave!
Thanks Uncle Dave, I write lots of Term Life, when suitable, but as usual, you're only partially correct, real life insurance is like owning property and you get you're money back plus equity, do you only "rent your whole life and invest the difference", your best agents can do both, JIM
5:46 man Dave Ramsey hit it right on the nail. “The Car lease, whole life insurance and credit cards keep the middle class in the middle!!”
GBACK2THAF - Warren Buffett has the most whole life insurance of anyone in the US.
Warren Buffet has a credit card. It’s how you use it. But he has only one credit card. He does not have six or seven credit cards
Dave Ramsey, on this topic, is a complete idiot. If his statement were correct, then why does Bank of America have MORE whole life insurance on their balance sheet than they do other asset classes? BofA certainly is NOT "middle class."
@@paulbetancourt3749 Simple banks that carry WL are wrong. It doesn't take a rocket scientist to realize that insurance companies keep the cash value in the policy when the person dies. The only people who like WL policies are weasels who sell it.
@@astroman30 There is no helping ignorance. Not only do you not understand how while life insurance works, you do not understand how to include it in your investment portfolio nor how to leverage it for your investment cash flow in retirement. Good luck to you, I can't help stubborn and ignorant.
My dad was 56 when he got life insurance a term policy wouldn't work. Whole was high $ but at 100K policy with an 80% cash value available. I wasn't going to get a 20 year term and try to renew at 70. He did not invest so options weighed and decision made. I couldnt save or invest over 50K in 10 years if he passed. Term just wasn't the better option.
Both my mom and Aunt are 80 and have term insurance. Their premiums have went over 200 a month and their coverage has went down with one only being 15,000. I'm torn between term and whole because of this! I feel like both is a big scam!
It has a lot to do with age. They just explain an overall comparison here. But people live different lives. Some have riskier jobs some have kids / no kids. Term has the advantage of being cheaper and you can invest the rest on your own, except if your not responsible, you won't have the discipline anyways. You could get term at 25 then at 55 you need again but you have developed a health condition. Can barely work now how will you pay for the new term when it's gone up 10x
Feeling so much better about my term life insurance policy 😌 since 2015
Likewise
I really hope you are investing the rest because when your coverage is over it will cost about the same if you went with the Whole Life policy and that’s hoping that you are even insurable when you go to reapply
@michaelmontalvo8603 There is a term that the policy expires ... I thought that as long as I paid, the policy continues to be active?
@@fr8tv4 the reason it’s called Term is because you are only covered for a certain term of time. Usually up to 30 years but obviously, the older you are, the more restrictions a company can place on it. For example at 50 you might only be offered a 20 year term and god forbid you become diabetic or if cancer or MS come into the picture than you will not be approved which is when you would need it the most
Term policies are temporary insurance contracts that have a maximum time frame which can keep a guaranteed flat payment. But once your contracted time has been met, it’s possible to keep paying for that contracted death benefit at what is called an annual renewable term and those price points can get pretty hefty. IE: 50 years old, 20 yr contract for $100k death benefit at $120 a month. Once 70 years old is reached can potentially become $700 a month the first year and will steadily increase each year after.
Whole life is not the only permanent option to keep forever with cheaper cost of insurance for cash value growth.
Source: I am an Advisor that does offer insurance options.
I don't think Dave truly understands whole life insurance and the opportunity that exists within those policies from an investment standpoint. He is right, do not withdrawl the money early, keep it in there. Do a 20 year pay and see what the policy is worth in 40 years after realizing 40 years of tax deferred growth inside the policy. Dividend rates in Canada right now range from 4-6.5%, not bad when you don't pay any tax as it accumulates. And, what other investments guarantee to give your money back after 20 years with the potential of realizing the upside growth potential, I can tell you not many that have a consistent 4 - 6.5% annual dividend rate.
@Day If he understood the product, his explanation would not be so inaccurate unless he was deliberately trying to misinform others. Life insurance companies make their profit margins off of term, NOT permanent, because permanent insurance is guaranteed to pay out while the overwhelming majority of term policies never will. The assurance of paying out is why permanent policies cost so much more; they have a limited amount of time within which to protect themselves against paying out way more than they receive in premiums, so the payments in the earliest years go more into covering the actual insurance. They can't just take in cash and hand it back and have that be a viable model, so they invest the premiums to grow the value and then pay dividends in return. The dividends grow the cash value as well as the death benefit so long as the company is a mutual one that returns revenue to policy-holders rather than outside shareholders. It's not merely a savings account, even though the returns vary based on financial strength of the company.
Well... I have been explaining the benefits of term life insurance and the many reasons why it is much better than whole life for years. I will be happy to explain it to you too. AND get you a FREE no obligation quote as well. Dave is Right.... Buy cheaper term, same coverage, invest the difference.... Get a lot more money returned.
I literally just saw a presentation of someone selling whole life insurance. I'm glad I didn't buy and went with term life instead! Thank you Dave
I hope that you are investing the rest because when you reapply after the term it will cost you about the same as the whole life you didn’t get and more importantly, I hope that you are still insurable.
You did the right thing. Don't listen to the salesmen.
@@astroman30 I guess you aren’t aware of doing your due diligence since this video is stating misinformation and bad opinions.
@@michaelmontalvo8603 Due Diligence? Whole Life insurance? Nah Biggie, trash value insurance is a scam. There's your due diligence.
@@astroman30 Agree With Michael. Why is it that Life insurance guys get a bad rap. Some of us like helping people. Sure we get paid money. How much you think Dave is making from his Program. You think he is doing the show and video for free. People with knowledge and an expertise get paid.
I think credit cards are good IF you have the money already to pay for it
Tragedy of the commons- individually a charge card (or a credit card used as a charge card) is good but the transaction fees used to fund rewards ends up raising prices for everyone.
@@hmrobert7016 not only that, the readily available nature of the card makes your spending habits more lose. If you have 200 in cash you are less likely to spend it than if you swipe the card. Obviously its 2020 so is more convenient to carry card instead of cash im just pointing out the psychology difference between paying with cash and paying with a card.
Lol I’m an investment banker who’s taken all the securities exams and I didn’t know this. Thanks!
He’s not informed to be giving people this info in the first place, massively misleading statements made in this video.
@@andrewfiore8926 I'm not understanding what is misleading? It's called the TRUTH! Suze Orman says the exact same things, and she IS a licensed agent in almost every state!
Are you an insurance agent, by any chance? Because you may want to look into what you are being told to sell! Dave speaks the absolute truth, and it's all written in the fineprint of a policy.... Facts don't lie!!!! (Speaking from my own experience!)
@@andrewfiore8926 you're a liar.
😲😲😲 Most bankers (even bank managers!) don't know this, so don't feel bad!
From my own personal experience, I know this to be the absolute truth!!! It's very sad how companies take advantage of their clients for a bigger paycheck!
When someone puts a complicated thing simple, often is inaccurate. I'd say it's worth discussing about insurance, about investment, about protection and about taxes.
"If you can't explain it to a six year old, you don't understand it yourself."
Albert Einstein
Just so everyone knows, the examples that have have replied to certain posts are strickly life pay whole life policies. There are also 20 pay whole life policies where you only pay a monthly premium for 20 years which is better than life pay policies.
20 pay means you paid in advance for a BS product. LOL
To anyone who has expensive insurances, ask for the cancellation form. Watch how your agent makes it hard and long for you to stop paying them money. Now imagine your beneficiary getting money from them. It is going to 100x harder
I don't have kids. But, I advised my sister's to buy term insurance. instead of whole or universal. That way if something happens to them while there still minors. There is money to take care of them. Once their grown, they SHOULDN'T depend on you, financially.
Of course they shouldn't, but undesirably situations can happen. What if they become disabled?
The sad part is sitting with a senior citizen who realizes their term is about to expire and now they're too unhealthy & too poor to afford anything with permanent coverage. All those years of paying term insurance but then it drops off & cancels on them. It's heartbreaking.
Then they should have done a better job of saving money before the term ran out.
Health insurance should not be an investment
I've been in the business for 30 plus years and have never once witnessed the situation you just described RoslynR. Your comment suggests it's a regular occurrence. Nothing could be further from the truth. Mr. Ramsey is correct. Would you like to know what is really sad? Whole life and Universal life are products that have done more harm to our industry than the collateralized debt obligation debacle back in 2008. These policies do however pay huge commissions to insurance agents.
@@josephd5715 Brilliantly stated, sir.
@@xJayhawkFANx Who is talking about health insurance? Why should some things not be considered an investment. Any time I can make my money back and receive a benefit along the way is a good idea to me. Where do you draw the line in what should count as an investment? I don't not deal with health insurance, I deal with life insurance. Yet I see health insurance as nothing but an investment. I have health insurance to reduce the cost of any medical expenses that come up. I spend a little now so I will pay less when the time come to actually needing it. To me that's a profitable return. Now with Life insurance it will definitely be profitable for the beneficiaries, the best part is when you can set it up with whole life and become profitable while your still living. Through interest and possible dividend growth you can reach that profitably level sooner.
I been following Dave a long Time. I think dave talking points are for people in a perfect world. Dave has great intent but unfortunately it's not the reality for the average person.
Sounds twisted. Millions of average Americans have succeeded through Dave Ramsey’s plan.
@@UHPhilipA O ok go head do u
Sooooooo.... what's the best advice Mr. Expert.
Had to listen to this twice, I get it now. Thanks🤗
The problem with this conversation or the way most people buy either term or whole life insurance is that they don't view it as the tool that it is. Period. Dave talks about the reason middle class people are staying poor is because of products like whole life?
Stop comparing a whole life policy to an investment...that's not what it is. It is a guaranteed storage vehicle for your money. Similar to a bank account. The reality is, a whole life insurance policy is not good for everyone. The other reality is that there is a reason whole life has a bad rap...most agents don't understand it.
Always think about what the agenda is of the people who are telling you anything. I am an entrepreneur and biz owner. My whole life policy is the best financial tool I have. I can't sell you anything.
Dave owns a term life insurance company and he has financial partners that he gets paid on when you buy into his philosophy...hmmmmm....
He always tries to keep the conversation very emotional. He does a good job of skirting around the details. I am going to get with my agent and have him do a video that I can share with everyone to give a real, detailed, technical understanding of each. That way you can make an educated, non emotional decision. I will work on having the video up shortly.
LIFE180: Leading Into Financial Excellence Dave doesn’t own a life insurance company
I agree! Please post the link back to this comment of the video when you post it.
and here is another thing and Dave and I pointed it out in the comments Whole Life also called Cash Value Life Insurance is a ripoff do get it, don't touch it, and don't buy it it will put you into debt and your descendants will be stuck your funeral bill and they will have to pay an estate tax. Don't do that buy Term.
@@geomodelrailroader You only pay estate tax if the death benefit is left to the ESTATE which happens if both the primary and contingent beneficiary pass
Actually it's not a savings, because once you withdraw some money they will deduct it from the insurable amount. Like example if you die, your family will get $280,000 but if you withdraw 80,000. Your family will get $200k only since you withdraw the 80,000.
Idk. I have whole life. Been paying $139 a month since I was 31 (35 now). The way I See it. If I live close to about 75 and put about $66K my whole life. I would easily stop paying and let the cash value deplete over the remaining years of my life. I can pass on my face value (not cash value) to my daughters.
Paying $66K for a return of 300K for my adult kids so they can build on wealth. I say that 66K for 300K was a good return in the end for my living family.
Get a 20 year TERM policy. Cancel the Garbage whole life. Do this ASAP. Your kids need to take care of themselves. They should not expect a windfall of cash when you die, anyway. If you invest $139 a month wisely, you will be fine.
@@kaohsiung99 yes, get a term policy that you'll pay on for 20 years and never get a thing out of since less than 1% pay out. Insurance companies LOVE term policies, they make a ton off of them.
@@KyleHurd Once I hit 58 years old, wife and I should have $1.5 mil in the bank/investments. I think I will let it lapse at that point.
@@KyleHurd Considering you yourself will never see a dime of any of it since, you know, you're dead and all? The point of term insurance is to pay cheaper premium when death is unlikely to be able to build enough of a nest egg that you are then self-insured. Life insurance isn't there to a windfall for somebody's kids etc it's there to replace income you currently make that your family depends on. If you have 1.5M or what not and a paid for home and are debt free how much income really needs replaced for your family to be able to continue on?
@@Matt-cr4vv you're acting as if the way you use life insurance is the way that everyone uses life insurance. I've been an insurance agent for 13 years and I can assure you that though some people want it to replace income a lot of people use it to create wealth for their family in the future.
I have had Whole life for my 2 kids for 10+ years, and just now realizing the waste of money it is. I guess I need to make some serious changes for this.
Don't cancel it, get a current illustration from the company who sold you the policy so you can see the returns down the road. Hopefully you got a 20 year pay and not a life pay, even a life pay could still make sense. 20 pays are good because you don't pay a time after 20 years and your balance keeps growing. Cancelling it could be the worst financial decision you make.
There is no return. Cancel as soon as you can. Or you will be sorry. I promise
I will show you the rules They dont tell you of it
Do not cancel until you have another policy in force. What could happen if you cancel and then you die while in the process to get a new policy? It can be easier to get a new product with your actual company.
1st of all, do NOT cancel your policies until you have the right policy in force!!!! Apply for a TERM policy with a reputable company, then once you're approved, you can cancel the WL policies you were sold! (My company taught me to buy term and invest the difference, which is exactly what Dave taught about here! Their term policies continue after the term, but the insurance decreases a little-best term product I've ever seen!)
Where are you located? They have offices all across North America!
Seeing an "illustration" of a WL policy is NOT beneficial whatsoever! It's an illustration, NOT a guarantee, like a lot of agents make it sound like!
Keep watching videos by Dave Ramsey and Suze Orman. Do the correct research, and your financial future will be bright, and you'll be miles ahead of the majority of people! Good luck!
@@cbdances4god your cash value is guaranteed. Your death benefit is guaranteed. What are you talking about. Maybe you went to some agent who ran illustrations with (not guaranteed) dividends factored in the policy
New York Life paid a 6% dividend rate to Whole Life policy owners in 2019.
What did New Your Life pay in 2018, 2017, 2016, etc.? Maybe 6% on what was left over after fees, and expenses which are (naturally) meant to nullify andy increase in dividends. Insurance is not an investment it is for emergencies/tragedies only. New York Life is NOT Santa Claus.
@@102nightwing NYL has paid +6% dividend to its "policyholders" for over 20 years save two years. All cash value grows tax deferred and its compounded, which is huge. What Mr. Ramsey fails to tell his listeners is the wealthy have been using this vehicle for over 150 years to build and retain wealth. Making money is one thing, keeping it is another thing altogether. Granted, WL is not for everyone, and ALL companies are not alike. Do some homework, trust no one!! Best wishes nightwing.
@@102nightwing Investment - "the action or process of investing money for profit or material result." I would say if used correctly, Life Insurance definitely will produce a material gain.
@@peanutsandcrackerjacks Life insurance transfers risk. It only pays out if an untimely event occurs. Life insurance only produces a material gain if the person being insured dies.
The stock market paid more after accounting for taxes. Even more if you invested in Roth IRA. People just need to invest in S&P 500 for 30 years and will come out better than any policy
Thank you, Dave. Can we trust any company selling term life insurance to pay our families as promised in the event of an unfortunate situation?
Primerica
thats what I am afraid of
@@Godsdaughter530 don't be afraid. At Primerica, we do what's right 100% of the time! We only offer term insurance. Be afraid to be led down a bad investment for your money dealing with a whole life insurance policy from an agent.
@@Godsdaughter530 at Primerica we do what's right every time!
@@tonyarice2452 Thanks Primerica! For your BS advertisement.
Thanks for spelling it out for me. I'm literally sitting down to start value building for my grandkid, and was looking up whole life, and your name popped up on youtube. If i hadn't watched these two videos, I woulda bought it, put it on auto pay and moved on...
He sounds good coming from an investment standpoint but whole has its benefits based on age and health. You can make either sound good or bad if you’re trying to sell according to a narrative but if the agent or broker is really trying to help they will properly educate the potential client so they can make the best informed decision. Do your own research people. Don’t get me wrong this info is still valuable to know👍🏿
the funniest part is that Dave Ramsey has a whole life policy lol. It's been proven that he has one and is telling people not to get one???
Another little item about that savings account. If you want to take money out of it. You have to play it back with interest. They try to tell you that you can be your own bank.
The problem with a term life policy is that once it expires you may be too old to get another policy at a decent price. There are various types of policies including Universal Life where the death benefit increases with the cash value of the policy. This video is misleading because it does not take into account individual circumstances, higher fixed rates, and various riders. Speak to a broker to get the correct and complete information.
That’s why you attached a retirement account alongside it so when it expires you become self insured because your investment accounts set so you become self insured, that’s why we call it buy term and invest the difference in Primerica.
@gregoryharris7174 If the goal is to leave money for your family members tax-free, then life insurance is the way to go. Retirement funds should be set aside for that purpose. However, there is no reason why you can't have both in place.
Indexed universal life is the way to go! I sell term, whole, and universal. Universal by far is the way to go. Best of both worlds.
IULs are garbage with their high fees/commissions and capped gains.
There are Pros and Cons for both types of life insurance. I don’t think there is a right or wrong choice. Whats important is knowing why you’re getting the coverage, or who is the person getting coverage. For example, if you just wanna leave something extra for your kids then a term would suffice. But if you’re not planning to have kids then a whole life policy might be a more conservative option. Because with the cash value available, you can choose to surrender the policy when you’re much older (usually about 20-30 years later) and get back your capital or a bit more. At this point it’d be as if you’d just left your money in your savings account for the past 30 years and now you need it for your retirement. The cash value for the whole life insurance policy in my country gives a pretty decent rate of return, about 2-3 times higher than what you would get from a high interest savings account. Most people aren’t that savvy when it comes to investing their money and it’s unlikely you’d make a profit every single year. A lot of people don’t invest their money at all for decades and end up getting peanuts from their savings accounts. And this is only one example.
The video clearly covers everything you mentioned. No matter how you cut it, whole life is a ripoff. You're paying for two products, but you only get one.
Term better than whole life
Not everyone is going to "invest the difference" even if you own a term policy. People just won't do it. What happens to people that have no assets, paid their term policy and the policy term is up? After the term ends your decision is either to hurry up and start building your stock portfolio, or turn to a higher priced term policy (since your term ended and they are older).
I have a permanent life insurance policy and my death benefit grows every year because I will get the cash value on top of my original death benefit. I started with 200K in death benefit and by the time I’m 65 I will have a 500K death benefit and 300K in cash I’ll have access to.
You better check with your company. Most pay one or the other NOT both.
@@RuthABush major companies do provide policies that work like this, like Nationwide for instance. It's an "increasing" type of policy where death benefit and cash value increase throughout years. They just have to be designed properly since agents out there think about their commission first instead of the clients best interest.
I learned this during my life insurance license class. I highly suggest people to invest in a course.
Which course? Whats the name?
Tell them the payout percentages of whole life vs. term. We make more money selling term than whole life, because the risk of the insurer paying whole life is almost 100%. The risk of them paying out term is almost 1%. When you by term you’re gambling with your life and you only win if you die. Please educate yourself before attempting to educate others.
There are many key points that weren’t disclosed or perhaps you don’t understand them, Dave I have a 52 year old male who took a $100k whole life policy 2 years ago to provide his family in case he dies (could it happen?) 2 years later there is a nice chunk of money and the policy has grown to over $102k death benefit tax free, investments are great too, they are just different I believe they can complement each other very nicely. Fix money and risky money perfect deal. Be smart goals are great but first take care of your priorities.
Is there a good company to go to when getting term life insurance?
Get Both! Term for when you a actually kick the bucket, granted you don’t outlive your policy, cause then your family doesn’t even get a penny. And Whole so you can actually withdraw your cash value or borrow against the cash value which gives you a nice nest egg.
BORROW against your own money, and you think this is a good idea?
Thanks for all the detailed information you have provided in this video. I like your way of explaining every point. Keep sharing such great videos in the future also.
Too bad the advice he provided is completely wrong
Had a relative who bought whole life with cash value. When his mom died, the insurance company only paid him the face amount and said that if he also wanted the cash value he would have to take them to court.
Would’ve cost him more than the cash value in his policy if he took the insurance company to court. In the end, he decided to just take the face amount.
All that extra money going into that policy wasted. Crooks I tell you.
Thanks for letting us know how this scam works. I see how this works now. No way in hell I’m getting this type of insurance. I meeting with my broker today.
It all depends what type of insurance company you are with. Some mutual funds pay better dividends than others.
Just all depends on the company.
Although dividends are not guaranteed, State Farm hasn’t missed a dividend in almost 90 years
As a State Farm producer with many other life insurance producer friends (not SF) I can say with full certainty that we have some of the best and most stable whole life polices. Period.
@@RexiRexx87 So State Farm is selling mutual funds now?
@@jalissas3152 thank you guys. I wish we could still see dislikes on videos cause I would dislike the shxt out of this dudes videos. sure he gives some good takes but overall he is a fraud and a liar only pointing out situational situations and ignoring the key points. just like CNN and the like, he is fake news
I honestly believe an update on your thought process of life insurance is well needed. It's been 6 years, and this is a very bold statement. You should reiterate if you still stand on what you have said prior to now. Life insurance is a very controversial topic. More than ever around this time period. May you please make an updated video?
He's made many.
Thank you Dave! Much appreciated sir.
I bought a whole life policy in 1992 for 100k from Metlife fro $103.00 a month. After 15 years, my cash value is 39,000.00. I also have 9K dividends that I can cash out anytime. I have only paid 29,000.00 in premiums. I made 19K and had protection sine 1992. What are you taking about?....
Edna Cunanan if you had invested that $100 a month in an index fund since 1992, you would have had a lot more than that.
Try again. Go to yahoo finance, pull up a chart of S&P 500 index fund. S&P from January 1992 of around $400 to a low around $800 in January 2009. That is still almost a double (or not wiping out your gains) . Plus if you kept the money invested until today almost $2400 on the S&P. Easily outpacing your insurance policy.
finance.yahoo.com/chart/%5EGSPC#eyJtdWx0aUNvbG9yTGluZSI6ZmFsc2UsImJvbGxpbmdlclVwcGVyQ29sb3IiOiIjZTIwMDgxIiwiYm9sbGluZ2VyTG93ZXJDb2xvciI6IiM5NTUyZmYiLCJtZmlMaW5lQ29sb3IiOiIjNDVlM2ZmIiwibWFjZERpdmVyZ2VuY2VDb2xvciI6IiNmZjdiMTIiLCJtYWNkTWFjZENvbG9yIjoiIzc4N2Q4MiIsIm1hY2RTaWduYWxDb2xvciI6IiMwMDAwMDAiLCJyc2lMaW5lQ29sb3IiOiIjZmZiNzAwIiwic3RvY2hLTGluZUNvbG9yIjoiI2ZmYjcwMCIsInN0b2NoRExpbmVDb2xvciI6IiM0NWUzZmYiLCJyYW5nZSI6Im1heCIsImFsbG93Q2hhcnRTdGFja2luZyI6dHJ1ZX0%3D
good luck borrowing your own 39,000.00
So, my beneficiary will still get a lot more than I put in. It's not money lost. I can surrender the policy for my own needs if I want to.
At least I know I have protection, I can sleep at night.
I was young and dumb. I bought whole life insurance. The policy is up to cash $4000 and the deducible to take it out is $5000.
If its not structured properly, it may be bad.
And that’s why i got my life insurance license with Primerica, and will never ever work for another company. I will never sell that crap to decent person, working and taking care of his/her family future. Buy term and invest the difference is the best way to go. It’s not easy to deal with some people who are afraid or misunderstand my company’s philosophy, but I feel very proud of myself and go to bed very confident I helped a family which the right product.
The BTID strategy didn't work out for Primerica's founder, did it. lol
Have you read the book "becoming your own banker"? I have many friends who thought the same thing about term, only to find out it wasn't true. 🫡
So you only sleep once every 3 years then, because 1/3 of a term policy is the net annual policy growth per year for Primericans.
@@johnd9541 In a $500G DB example, the premium is $430 a month from age 40. Nick lives to age of 90. So with whole life insurance, Nick pays $430 a month for 600 months (50 years) total $258G. Dividend is $130 a year best case for 50 years on the premium paid, or $6500, for a cash value of $264,500. The alternative is to buy term life insurance with extended duration and invest the rest .. a $500G death benefit policy for a 30 year term would be about $60 a month leaving $370 available to save .. $370 monthly in the market at 7% (stock market lifetime average) in a tax deferred account gives me $432G after 30 years. I won’t need a $500G policy if I’ve got $432G cash in my account, so I cancel it, And for the next 20 years my account keeps growing at the full $430 a month. when I’m 90 the account is worth $1.9 million. Conclusion is clear .:. Do I want $264.5G (whole) or do I want $1.9 M (term and invest) for the same premium output .. I choose term and invest!
Its convenient to put everyone in the same group. Life events happen, wealth may or may not be accumulated and term may or may not be an option or affordable later in life.
Most people don't have a need for any kind of life insurance later in life by the time term becomes unaffordable.
@@chrisstaub5880 I disagree, most people do need it. Now if you're talking about middle class families then its not really a question of whether they have the assets or not, it becomes a question of where are the funds coming from?
@@jeremyed9507 I'm not talking about middle-class, I'm talking about everyone. Life insurance should only be needed as a means of helping to support others who rely on your income, such as young children. Anyone who has no longer has any dependents, no debt, and a good amount of savings/investments has no need for any kind of life insurance, and most people are capable of reaching that point. Now, if you're talking about someone who is already older and hasn't managed to save anything, it's quite possible they may still need it just to pay for burial expenses and leave something to their heirs. However, I believe that most of those situations are a result of poor money management earlier in life, so most people have the ability to prevent it. They are plenty of ways to ensure you leave a decent inheritance to your children, and it's usually no one's fault but your own if you reach the point where life insurance becomes the only way to do that.
@@chrisstaub5880 The point is that blanket statements don't help anyone here. You think of life insurance in terms that make sense to you but it is just a tool. Use the tool as it best fits your circumstances and move on. As far as what people are capable of and what actually happens...well.
Thanks so much for explaining all of these, i never understood it before!
Wow, this video was really informative! 😍 I'm so glad I now know the benefits of term insurance. Thank you so much for explaining everything so clearly! 🙏
I almost got "tricked" into selling whole life as an insurance salesman, or 'representative' as they labeled it, for a large mutual financial services org. Learning more about the ethics and scheme of 'WHOLE LIFE' as a product disgusts me. You have to wonder; how can those salesmen live with themselves knowing they've sold someone a garbage product that has considerable life consequences? I could not do it.
God bless you, Elijah. You have integrity and class.
I have heard that with term life policies the premiums go up a lot after the initial term, whereas with whole life policies the premiums never go up (they're "locked" in). Is this true?
It is true, but the real question here is how long do you need insurance?
You can buy term up to 30 or 35 years depending on the company. Let's fast forward35 years... are your kids grown? is the mortgage paid off? have you been paying yourself first for 30 to 35 years? Are you investing with a IRA (Roth, if possible) or 401k to get the employer match? If this is all yes, then do you have a need for insurance three decades from now?
And funeral costs? If you have $500k cash, I am pretty sure you can pay for a funeral.
YUP! Also term once its done 20 years wtv you have to re-apply and guess what your health condition most probably isnt the same 20 years ago! Think about that!
Nick Pallotta wrong no medical qualyfication required
So you mean you would like to be robbed your whole life? Bring your policy to someone to really explain it to you instead of just asuming.
Save money from the begining of your policy so you dont need it. Any more but save separated from any life insurance.
20 years is generally enough to make sure your children are grown and not in need of your income.
@@alicelaybourne1620 what about your wife? Will she be grown or are we more concerned about them....
The best life insurance is the one that is in force when I die.
Tax free to my beneficiary.
Permanent insurance says that when I die the death benefit WILL be paid guaranteed.
Term insurance says that if I die WHILE the term policy is in force say 20 years it will pay a death benefit.
Most people's term insurance runs out when they NEED it most. And if your health has changed you cannot qualify for more.
Dave is being hypocritical about buy term and invest the difference he never mentions losing money to stock market risk.
Permanent life insurance is all about guarantees with NO market risk.
Think about it and use your brain Dave has made a ton of money criticizing whole life insurance.
I do like his debt reduction snowball idea.
Dave knows permanent insurance has its place in your portfolio he just won't admit it.
Term insurance is always good but don't bad mouth permanent insurance.
KR 39 years as a life insurance agent.
Yeah a insurance agent protects an insurance product. Sure
@kennyrudd big facts
@@ProDVIet93 brah... you don't even know. many of us are good people that have conviction in what we do. I tell my clients I would never write a policy in bad faith.. & I mean that
What’s wrong with a credit card if you pay it off every month? I haven’t had a credit card balance go unpaid in over 30 years. However, I use a credit card for 99% of my purchases. I get a lot of perks with it. What’s wrong with that?
Agree!!!
You forgot timeshare
The only problem with timeshare is the maintenance fee. Were it not for that. it would be fine.
The problem with Term is better, is many people are finding themselves old, sick and uninsurable. They have outlived the term policy, have not built wealth along the way, and will die with no insurance. I believe having a combination of permanent and term is wise.
SMART investors Jimmy and Janice:
1) Buy two 20 or 30 year term insurance policies, for about $80 to $120 per month for BOTH policies at $500K coverage.
2) Two years later, they saved enough for a down payment and can easily afford $1500 a month for the payment.
3) Jimmy and Janice now have a tax write-off and their house keeps appreciating. Jimmy and Janice also enjoy living in a house instead of an apartment because of all the noisy at night. They sleep well
STUPID investors Bill and Betty:
1) Buy two Cash Value Life Policies ($500K) at $500 each or $1000 both per month.
2) Two years later they want to buy a house, but cannot afford $1500 per month for their house payment PLUS $1000 per month for their Life Insurance. Problem is they cannot stop paying on their policy or they will lose their contributions by paying a huge surrender fee.
3) Bill and Betty continue to rent.
Lol Terrible scenario the right one would be... Universal life policies 100k each and the rest term joint first to die 30 year policy when they purchase a home.
I so agree with a Permanent Life Insurance and term life insurance with living benefits
Carol Cherry that is why Dave stressed the baby steps. Also, if you outlive your terms and find yourself old and sick, that would normally mean you don’t need any insurance at all. Insurance is for when someone depends on you completely for an income “breadwinner” when you are no longer in that position insurance is not needed.
I’m not sure how all life insurance companies set their polices up, but with State Farm a whole life policies face value grows. So yea you won’t get your cash value if you die, but you get the face value which grows very quickly. A 100,000 policy for a 26 year old would be about $100 a month and by the time they are 70 it will be about 170-180k. I think Dave might be right speaking in general but I don’t know if he’s actually searched through every companies policies because they are absolutely not the same.
If you invested $1200 a year for 44 years in an index fund , I guarantee you will have more than $180k by the time you are 70yrs.
That is Ill advised. The cash value is there to hedge against the mortality rate which is what keeps the cost of insurance down (or fixed) as you get older. The cash value at death is built into the death benefit. That’s why if you turn on income (or annuitize) the cash value the death benefit decreases. If you get with the right advisor term or whole life can properly positioned. A poor advisor for any financial product can cause more harm than help. The policy is it meant to pay an agreed upon death benefit. If it does as stated then every party received what was contractually obligated. Insurance and Annuities come with contractual obligations that are mandated federally and by the state.
Simple question: What happens to the "cash value" when the person dies?
The cash value is only a an account that is used to build funds that hedge against the cost of insurance. The older you get the more insurance cost because you are closer to death. When you buy insurance, you pay a smaller amount for a larger amount in return. Instead of the fees continuing to increase every year the cash value account saves funds that are used to essentially buy down cost. The funds are directly tied into the death benefit or the benefit that is paid out. If you take funds out of the CV account it reduces the death benefit. As the CV increases the death benefit increases. With that understanding the CV account is not separate from the death benefit they are one and the same. So, when the insured member dies, the funds are paid to their beneficiaries. It is not a separate payment it is an inclusive payment. If coverage is 100,000 and you borrow or withdraw 30,000 from CV then you get a death benefit of 70,000 if you have not replaced the funds back into the account. On the other hand if you started with 100,000 in coverage and your CV builds 30,000 in cash your coverage amount will increase. How much it increases or when it increases depends on the type of plan you purchase. The simple answer to your question is the cash value and the death benefit are paid as one payment which is your death benefit or face amount. The benefit of the Cash Value is that you don’t have to die to use it or to access it.
@@darrickharris5534 You're lying. When the person dies, the DB and CV are not "paid as one." The person's beneficiary only gets the DB. The rip-off company KEEPS the CV. Stop with your double talk nonsense. The best thing about youtube is that it shines a light on you cockroaches who want to steal from the less-informed.
astroman30 you know nothing about me for one. Two there is a contractual agreement when you buy life insurance. Everything is in writing. You put your money into banks that pay below 1% on ROI, you will put your money in high risk investments like stocks with no guarantees, but criticize the only product that gives you guaranteed growth and coverage? I am not a liar at all. All I did was provide the information. There were no bias in my response. You can choose to research and be educated or not. Just like anything else, different strokes for different folks. If it is not for you then don’t do it.
@@darrickharris5534 Stock market is at an all-time high. Again, the rip-off insurance company KEEPS the CV in the policy when the person dies. The family only gets the DB. Stop with your lying that the family gets both. People, please cash-in your WL policy. People who sell this garbage are scammers.
Ok I like this man and I gotta call my insurance ppl on Monday and get out of my policy
When you policy starts to build cash value your death benefit definitely increases if you don’t pay out the dividends.. and being ill and uninsurable isn’t stuck you’re safe and your parents took good care of you.
People aren’t smart enough to know who to listen to. Why would anyone listen to this man when it comes to life insurance? This man knows nothing about life insurance. He should stick to teaching people how to stay out of debt and leave the life insurance advice to professionals who actually do this!
I have written down all of Dave’s pros/cons and I understand his point of view. However, one thing he never mentions, is that on term - you outlive you’re policy and get nothing. In whole life, the death benefit is guaranteed. That makes playing term for 20 years a terrible investment if you outlive it. We never discuss that, and I don’t understand why.
So, what happens to the cash value when the person dies?
Thanks Dave I was in market looking for life insurance, you saved me once again
I'd suggest not to trust blindly neither Dave nor IBC/WL (infinite Banking Concept, which tries to benefit off the Whole Life policy Cash Value) videos and literature. Schedule some interviews with agents, explain to them what you need, how would you use Cash Value, Loans... and ask them to provide you with their options (called Illustrations). Then, create your own illustration on investing in some other vehicle (IRA, stocks, RE, 401k...), but be as detailed, realistic and accurate as you can be (accounting for realistic gains, taxes, fees...). Then - compare the two (IBC/WL vs. your vehicles) assuming the investments of the same amounts (from your pocket). Look at how they are comparing in short term (5-7yrs), mid term (10-220yrs) and long term (>25yrs). I've done several interviews with IBC/WL practitioners and build out very detailed spreadsheet for my own investments. I'm still searching for the IBC/WL policy that would beat my projections, yet I CANNOT SAY that IBC/WL with all its fees and complexity is grossly under-performing. It delivers less growth, but one of the benefit of if could be low risk and stability. Basically, once you have your policy, you are on auto-pilot, unaffected by the markets, interest rates and your time to (not)spend on active investments.
I sold Life Insurance and bought whole life myself, for my brother and wife. After almost a year of my returns were almost nothing after paying $500/month. My wife and I cancelled our policies and told my brother to cancel his as well. It's ridiculous how such a ripoff whole life insurance is. I felt so bad for ripping my family off into this garbage.
So for how many years did you sell life insurance? Why did you sell life Insurance? What did you expect, its not an investment. Its income protection and risk transfer? I am willing to bet you had poor training.
@@sethhiggins7783 I only sold it for about a year. The training I had was terrible. They taught us to sell the whole life package from Transamerica called the FFIUL. We were told lies about how great it was with all these riders and how we can grow our money tax free and at the same time protect our families. It just didn't make sense paying $500/month for a whole life package, seeing very little to no returns at all, when I can be getting a 30yr term policy for a fraction of the cost as Dave mentioned. So yea the training was bad in a sense that they taught us that we can use the whole life package as an investment. They showed us the average return rates on our investment and it was no where near what they showed us. I worked for the pyramid ponzie company WFG.
I went from paying $20/mon for $20K in term coverage to paying $26/mon for $100K in whole life coverage. So this confused me a little bit. The term policy would have ended in my 40's, had I kept it. If I still wanted to continue coverage at that time I would have had to get a new policy and pay an even higher premium for it, since I would have been in my 40's instead of my 20's, as I was when I took it out, wouldn't I? And if my health had gone down in the meantime? I've had the whole life policy for 17 years this month, so I currently have $5302 invested in this $100K policy at 53 years old. That's considered a bad investment? At this point (my son is now grown) a better option might simply be a pre-paid funeral plan, if I could afford that, but at the time I was a single parent with a child (whose other parent was a deadbeat in hiding who had nothing to do with him), so that seemed like a much better option to me at the time... 5 times the coverage for $6 more per month.
Exactly because I’m finding there is no one shoe fits all as I’m doing my research
You did good, I look at it as a bonus bet but for my loved ones incase I got a bad roll in life. Also you can use that $5k you invested and pay it back as loan I believe and it should still be collecting your % interest as if it was still there. Make sure you check with you agent on all this. Also average funeral cost is 9k so you wouldn't be able to pay for it. The whole increase in premiums as the years continue is interesting..
What company is it? I'm looking for a good whole life insurance company
@@Ben-tr American National
@@Ben-tr Message me back. I have some awesome options s for you. Have you heard of an IUL policy. I can definitely help you Sir. Looking forward to speaking with you.
Insurance is not a bad deal. You pay a little to avoid a small chance of a big cost. Whole life insurance though is a scam though because the money saved from only buying term is money you could have invested at a higher return.
My boss was a very wealthy & financially successful man. He told me : " Anyone who comes to you to sell you something is there for THEIR benefit, not yours."
Life insurance is not investing. Life insurance replaces income. If you can’t save five years of your income then you can pay premiums to “ensure” your income is there for your family if you’re absent. If you’ve paid in $5000 and your loved ones get $15k that’s pretty good if you ask me. That’s why I have it. I love Dave Ramsey. This is my only issue with his coaching.
Insurance is a RISK MANAGEMENT purchase, not an investment. Buying term and investing the difference far outweighs buying trash value insurance.
Term insurance is harder to get for older people. I agree with Dave's point. But getting approved for term isn't easy.
Older people with no dependents don't need life insurance.
@@astroman30 they dont? Is it free to bury people with no dependents?
@@thomasscialla1115 paying $400/monthly premiums on a trash value policy is stupid for just burial expenses. I would save up my money and pay cash, or, pre-pay my funeral. Try harder
@@astroman30 I would never recommend that anyone pay $400 a month for a policy just to cover their burial. I don't know who tried to sell you that "prison love" policy, but you were right not to buy it.
However, 99.9% of burial policies don't cost $400 a month. Most are well under $100 a month.
Why are you so angry?
this guy only looks at everyone as "the same" we are not all the same and we talk about returns. returns are better. zero cost loans exist he knows that. in fact arbitrage exist too.
Life Insurance is only great when you get them when you are young and you have no health issues. My wife and I, we got our life insurance extremely cheap (in our early 20s) and enough to pay off our house if one of us passes away. Between both of us, we pay under $75.00/mo. I would never get a life insurance at my age now, 41. The monthly payments would be outrageous!!!
Same here. Got universal life when I was like 20 and pay around 53 bucks.
what is the difference between universal life and whole life insurance ?
You choose your investment structure! Conservative, balanced or aggressive funds. If the markets are doing great your policies pays for itself...I wonder why Ramsey didnt mention that aspect.....
True it is best to buy when young and healthy, but if you are not financially independent, you do need it. The true meaning of life insurance is income protection, because it is your income that pays Fir all the the things you have. It is for those who are left behind. High quality term along with investing would be the way to go. As far as cost you have to decide on the value of your loved on es to you and your budget. Peaoplw seem to have money for everything else other than their loved ones
@@shadowrealm7858 Because insurance is not a true investment . vehicle. That is not it's purpose. It is just a trick. Why would you settle for those so called me as key rates of return, when you could invest in mutual funds averaging 10% and above. Save yourself
Here's why a permanent policy is better than a term policy: 100% of permanent policies pay out, term policies pay out at a rate of less than 1%. Term is a great product if it's all you can afford certainly. However, that extra "$95" you are paying into opens up a product that allows you to manipulate it as a tax shelter, provides cash value via dividends, protects you for your entire life, and so many others. What happens when your son gets cancer? Oh we'll just pay for the treatment with cash right Dave? That's where the beauty of a permanent policy can come into play, take a low interest loan or cash out your policy tax free. 100% of people die, 1% die within the term of their term life insurance policy with their family collecting the payout. Google it.