New forum member here. Spent yesterday reading volumes here about the dangers of a WL policy, but I'd like some feedback based on my own unique position.
My position--41 years old, gross about $325k a year and max out my traditional IRA, 401k, and deferred compensation programs (200% match). No debt besides a new mortgage taken out about 2 years ago. Regular contributions also made to traditional brokerage account holding mutuals, stocks, etc. No children but live in high tax state with high real estate values and most planning goes into ensuring that my wife is cared for should anything happen to me.
I purchased a $500k WL policy ($600/mo, $8k premium a year), along with a good amount of term and disability in late 2015 from a close, long-term friend and associate at NWM. I trust him implicitly--just to get that out on the table. Roughly $17k in premiums paid, cash value is around $10k.
Based on my situation, is there still no value in this kind of option? Fully understand that the break-even timing for the cash value and premiums paid to align can be significant, but the primary selling point for this "investment" was the fact that I could get regular (albeit lower) returns over time, in addition to the dividends (albeit now declining), that could grow on a tax-free basis. Agreed that better returns could potentially be realized on the open market, but would require me to increase my existing investment exposure already in place.
I am uncomfortable with the fact that utilizing money that is paid into this policy requires me to borrow against it at a pretty sturdy interest rate. The idea that the "cash" is there for something like a down payment on new property is false, as the idea of paying back the loan in conjunction to a new mortgage would be prohibitive.
I don't feel taken by the situation, and I've asked tons of questions along the way. And the actual outlay is not that significant, but I am definitely not interested in continuing to plow money into something that does not make sense for me.
Interested in feedback specific to my financial situation--thanks in advance.
My position--41 years old, gross about $325k a year and max out my traditional IRA, 401k, and deferred compensation programs (200% match). No debt besides a new mortgage taken out about 2 years ago. Regular contributions also made to traditional brokerage account holding mutuals, stocks, etc. No children but live in high tax state with high real estate values and most planning goes into ensuring that my wife is cared for should anything happen to me.
I purchased a $500k WL policy ($600/mo, $8k premium a year), along with a good amount of term and disability in late 2015 from a close, long-term friend and associate at NWM. I trust him implicitly--just to get that out on the table. Roughly $17k in premiums paid, cash value is around $10k.
Based on my situation, is there still no value in this kind of option? Fully understand that the break-even timing for the cash value and premiums paid to align can be significant, but the primary selling point for this "investment" was the fact that I could get regular (albeit lower) returns over time, in addition to the dividends (albeit now declining), that could grow on a tax-free basis. Agreed that better returns could potentially be realized on the open market, but would require me to increase my existing investment exposure already in place.
I am uncomfortable with the fact that utilizing money that is paid into this policy requires me to borrow against it at a pretty sturdy interest rate. The idea that the "cash" is there for something like a down payment on new property is false, as the idea of paying back the loan in conjunction to a new mortgage would be prohibitive.
I don't feel taken by the situation, and I've asked tons of questions along the way. And the actual outlay is not that significant, but I am definitely not interested in continuing to plow money into something that does not make sense for me.
Interested in feedback specific to my financial situation--thanks in advance.
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