IUL For Children
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- Опубликовано: 11 окт 2024
- Lately, I’ve getting requests for Index universal life insurance policies on children, so I thought it was about time to make a video on that topic. This is almost identical to the 529 or IUL video with some added accumulation possibilities at the end.
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• IUL For Children
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The Wealth Protection Lady makes content available as a service to its customers and other visitors to be used for informational purposes only. While our best intentions are to provide accurate and timely information, you should always consult with retirement, tax, and legal professionals prior to taking any action.
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Very interesting. I wounder why you used example of money growth three choices ( green, red, blue) from 1998 until 2013? your presentation is in 2021 and I am watching this in 2023 . Your explanation about different products is greatly appreciated !
She's cherry picking the years that best make her point.
Run the same $100/mo into a conservative mutual fund and see what it will look like after 35 years. Sure if it is a non-qual account, you will owe some taxes, but would you rather have $100k tax free or $300k taxable?
I was wondering if a mutual fund is in the market, and at the rate our world is going, most likely taxes are going to go up so wouldn't more taxes mean less money coming into your pocket? I would like to have tax free money.
IUL main advantage over other mutual funds is leverage. In the event something happens while in the middle of accumulating wealth, you’ll have a large sum of money. If you open a mutual fund today and something happens after a year, you’ll just get that one year contribution plus the interest if any 😮
Probably a dumb question - but as the child gets older - doesn't the cost of the term component of the premium keep going up? I know the gains of the policy will go to pay the increased premium, but what happens when they turn 80 and 90? Isn't the term component VERY large by that time? Won't that erode the gains? Won't the premiums eventually have to increase? It's a great idea, but I'd like to know more about what happens in 70 and 80 years.
You borrow from your death benefit that crashes the cost….the biggest issue is people don’t fund these policies properly because agents mislead them so the product is doing its job but the agent has to structure it properly and not just there commission
@@miketakhar7296 That doesn't seem to answer the question. Assume I don't borrow from my death benefit - and assume my agent set up the policy properly and explained everything thoroughly. What happens to the premium when I hit 80, or 90, or even live to 95? Doesn't the premium keep increasing every year? Won't I eventually get to a point where even the growth in the cash value no longer keeps up with the premium? I'd like to see more examples to age 80 and 90 and 95. I know its a super-performing index, but what happens when the premiums keep going up and up for decades?
The rising cost of insurance is a concern. It is always the most expensive at the age of 90. The Securian BGA II IUl begins reimbursing you for your expenses beginning in year 11, so that rising cost of insurance is a non issue with this product.
@@WealthProtectionLady Without an illustration, people can't judge what you're saying. And there's the problem. You're not able to illustrate the returns you're quoting verbally. "Don't read what this illustration says, you're going to get a much higher return. See what would have happened if you'd been invested in this index between 2001 and 2013? This index can't fail." Considering other unknowledgeable and careless IUL salespeople out there - I'd definitely rather have you all day, but I can't get over the increasing premiums of IUL when people get to their 70's, 80's and 90's. Maybe not your clients, but a LOT of people who jumped on the IUL train are in for a very rude awakening as they age.
@@WealthProtectionLadyare you taking on mentees?
I’d like to schedule a consultation to IUL for my husband and I and for our 4 yr old son. We’re currently in the market to get started as soon as possible. We’d to compare a current proposal we received from another agent.
Email me at sue@wealthprotectionlady.com and I will run an illustration for you.
This used to be called whole life insurance. They continue to change the name, cash, cash variable, 707, now IUL, because people catch on thats its a SCAM! In a couple of years, they will change the name again. Don't lose your money to this scam. Just open a charles schwab account and buy, apple, ExxonMobil, bank of America, and Coca-Cola.
Hey! Wonderful educational videos. Question do you have clients? If I have further questions about IULs?
Best thing to do is to watch my videos: IUL for Dummies, Properly Structured IUL, Life Insurance Loans and IUL on Steroids. If you are interested in an IUL for yourself or your children, complete this questionnaire and then we can schedule a time to go over your needs. application.wealthprotectionlady.com/
Why does the market offer a 10% interest rate for lending, while insurance companies charge only 5%? Additionally, are the fees associated with obtaining funds from insurance companies not higher than those from market lending companies?
One of my kid have it, I want someone else to do my new bb in case something was left behind
Hi, Johanne! If you complete the following questionnaire, we can find a time to talk: application.wealthprotectionlady.com/
Question, does the parent have to have an IUL in order for their child to have one? Parents in this case are uninsirable.
Parents do not need to have an IUL, but combined, they need to have twice the life insurance as their child and that insurance can be through work.
Great video and explanation on !
Thank you, Brandon!
This question will be a bit unusual I guess.. I've watched a couple of your videos what do you call a single premium iul.. would I be able to avoid paying income tax by putting $100 to $200,000 in one of these hypothetically?
A single premium IUL is a modified endowment contract, which has none of the tax-free benefits of an IUL. If you have a lump sum, you would want to put that into a premium deposit account. You would have to break up the lump sum into between 3 and 11 years. Your first year's premium would be paid and the rest of the money in the PDA would earn 5.25% interest. I don't recommend it because you do not have access to the money in the PDA. It is just sitting there earning 5.25% interest and I bet you could find a better place to put that money that would earn more than 5.25% interest, and that would be real estate.
@@WealthProtectionLady okay I appreciate that... I'm trying to learn about these index Universal Life policies.. and I see that the insurance carrier can change the participation rate as well as the cap rate which I'm not thinking is a good thing?
Thank you for sharing .
If there are no contribution limits how do you keep the policy from becoming a MEC?
The MEC limit is determined by how much you are contributing and your age, etc....
Can you offer that same chart for 2012-2022?
Hi, Kristine! I can't even remember where I got the chart from.
I was told distributions from a cash value policy are taxable to the recipient as income in the year they are recieved. Does that mean the money taken out for tuition is then taxed? Can you explain,im confused.
Distributions in the form of a loan are never taxed, so whenever you access your money, you will always take it in the form of a loan. That way, it will always be tax free. If you take a variable loan, that loan amount remains in your policy earning interest. You can choose to pay the loan back or not.
Distributions in the form of a loan are taxed only for MEC'd policies.
my 18 year old daughter works for me under my LLC, earning $12,000/year. Do you advise a custodial roth ira or an IUL? thanks,
Hi, Anthony! I would always recommend an IUL because you can never lose money.
Hello, Can you set up a policy before the child is even born? sorry if this is a dumb question.
No. The child must have a Social Security number. Not a dumb question at all.
do hve training or master classes?
I do not have training, but I am thinking about it for the future.
How much are people contributing per month?
Anywhere between $50 and $500 per month for children
Excellent 👍
Does the policy premium go up with age and then the cash value starts going down?!
The premium is your contribution and that is usually constant unless you need to lower it. You may be referring to the cost of insurance and that is annual renewable term so it does go up as you age. The cash value would not ever go down unless you are in an expensive policy and/or it is not structured properly.
This was my question. Does the monthly premium not include everything? From my understanding if you set out to pay $100 monthly, can you continue paying that amount for the life of the policy or that amount can increase? I guess what I'm saying is, what if you can't afford more than $100 monthly?
@mypasstime100 she's not replying to you because that seem to be the case. With IUL, as you get older, your premium $100 dollar can increase to 200 dollars. But they say don't worry because your cash value will pay for the increase of $100 dollars.
Can you borrow against your childs IUL?
Yes.
Do I contribute IUL every month till 65yra of my child age or there is an option to fund let's say next 5 yrs with $5k each year.
You need to contribute for at least 7 years. Most people contribute until their child is 18-20 and then they can take over contributions.
@@WealthProtectionLady thank you for the response. If the child doesn't contribute will the policy still be considered active ?
@@nubile8000 Depends if there is enough cash value to sustain the policy meaning as long as there is enough cash value accumulated will cover the premiums and thus the policy still active or if the child can continue to contribute.
Do I have to pay back if I draw cash value after age 65!!! Do I have to pay tax!!!
Do the cash value decrease if I don’t draw cash value 100 age!!!
The policy and fee charge , going take all the cash value after age 80!!!
Once you start taking an income, you would not pay those loans back because by taking those loans, you are buying down the surrender value and death benefit until both are depleted. You would not pay those loans back. If you don't take loans, your money just keeps growing. After the 10-year surrender period, you can take a loan for your surrender value, which would probably be the same as your cash value.
Can a child’s iul be over founded and if yes how much over premiums?
It depends on what the annual premium is. There will be a MEC Limit (modified endowment contract limit) which is the maximum amount you can contribute in any given year above the premium noted on your illustration. If you go over the MEC limit, all the tax-free stuff will go away.
excellent, thank you.
You are welcome!
Can you cancel an indexed life insurance within a year or 2?? If so what happends?
An IUL has a surrender period of usually 10-14 years where if you were to cancel your policy within that time, you would pay a surrender charge which is typically 10% the first year, 9% the next and so on.
Can I do it for Grandchildren ?
You can; however, it's a little complicated. Better for the parents to have one on their child.
Can I fund my IUL with cash on hand or only through 401k, etc?
An IUL can only be funded with money that you have already paid taxes on. You cannot fund an IUL with a 401k.
If the money grows tax deferred, when do you pay taxes?...
Whenever you access your money you would always take in the form of a loan. That way, it is always tax free.
@WealthProtectionLady thank you. I really like the way you explain it on your videos. Soon, I will reach out to you so I can get an IUL started.
The parent own the policy on the child's life ? If parent dies what happens?
I have IUL but its a guaranteed at .25%
Does that cover the mortality expenses?
It looks like the guaranteed return is 0.25% in the worst-case scenario, meaning that the rest of the market it most likely at a lose.
Where’s the application?
Here you go: application.wealthprotectionlady.com/
Is there any IULs for children that come with living benefits?
Yes. They all do.
@@WealthProtectionLady that's interesting, the ones I have checked with major carriers do not have living benefits for juvenile iuls
Which carrier is the best carrier to use?
If a person does not make An annual income of $100,000 is there another program for this type of person?
Yes, you can still qualify for this product. Let me know your availability so that I can show you different options
Thry tax after retirement!!!
IUL loans are never taxed. Ever.
Market was down from 1998 through 2013. Simply incorrect.stop spreading lies
I don't lie, Srikanth! Just because the market was down doesn't mean this particular index was down. The volatility control index I deal with is rebalanced every single business day and because of that, had a gain of 20.47% in 2008 when the S&P 500 lost more than 38% of its value. Not all indexes are created equal.
@@WealthProtectionLady So, you took ONE year of 2008 and completely ignored historical chart from 1920s through recent times. Granted you are correct only for 2008, your statement is incorrect when we look at the entire history. Do you mind sharing your annuity gain against S&P index year after year from 2000 through 2021 , make a video and share it with us? As a professional with client's best interest in mind, it doesn't hurt to say that your clients should examine the performance of a most popular index for 20 to 30 years and compare with your preferred annuity of choice performance before coming to a conclusion. Who are we fooling here?
@@srikanthk5769 are you dumb? Do you understand what IUL indexing does? It’s point to point…. So it doesn’t matter what the market does over any period of time other than the indexed point to point (1,2 and 3 years) for most index options in an IUL.