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  • My Whole Life Pain

    could really use some advice here.

    short story 36 y/o male surgeon healthy, engaged no kids yet. 46K student loan [email protected]%, salary 375K. only other debt modest mortgage.

    I was convinced to purchase a adjustable comp whole life plan from northwestern mutual. This was advised by my doctor specific NWM financial advisor instead of paying off my loans. This was before I started understanding my finances and I was very naive when just starting practice.   2 million dollar plan for $26K per year. I am now 2 years in and have put in $51K and my cash policy worth is $18K. now I understand that my cash value will grow with time, but I am kicking myself with the fact that I could  have $51K to finish off my loans etc. ( I also hate the fact that 33K of my money is just in the ether some where)  I don't have a lot of expenses so I don't "need" the $2,300 a month that goes into my whole life policy, but I still wonder what my options are. couple questions

    1. Is there any way I can go back to term insurance and not lose the entire 51K I have invested? Is there an adjustable back towards term?

    2. Will my cash value ever get back to offset the premiums I have put in?

    3. If I wanted to change my agent and keep my policy what would I have to do?

    I really appreciate anyone's advice. My education continues,

    doc01

  • #2
    The sad fact is that most of your $51k is gone. The agent and the company have already spent the $33k. Take the cash out and move on. Lesson learned.

    PS I look at Doctor-specific financial "advisors" with some level of suspicion, and in the future, you should also.

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    • #3
      Welcome to the world of so-called "Doctor-specific" financial advisors.

      1. Doubt it unless there is some weird provision in the plan. An insurance person will have to address that.

      2. No. The agent (aka "Doctor-specific financial advisor") has to get his/her cut and NWM has to make (a lot of) money

      3. Call NWM or choose another agent to handle the transaction for you. But why would you even contemplate that idea?


      The term for your situation is "sunk costs". You cannot get them back and what you need to do is make the best decision possible going forward and considering yourself even. If you would not re-purchase the same policy again today, then you should cut your losses and thank whoever you pray to that you are only 2 years in. That may sound like a lot of money to walk away from at this point, but just think how much more you will fritter away by sticking with the plan while trying to recover your already lost payments.

      Don't beat yourself up. Consider it a somewhat expensive lesson that will prevent you from making even greater mistakes. And, if it helps, understand that you are not alone, by a long shot. Cut your losses - as a 36 yo physician, you are in a great position to overcome this mistake and you have plenty of time to do so. We (people in general) all make them. Education never ends.
      Working to protect good doctors from bad advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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      • #4


        Be sure to inform colleagues about this advisor.
        Click to expand...


        Great point!
        Working to protect good doctors from bad advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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        • #5
          This issue is so common I wrote a post about it and it is one of the posts I share most frequently:

          https://www.whitecoatinvestor.com/how-to-dump-your-whole-life-policy/

          2 years in you probably want to dump it, but run the numbers first to be sure. If you do dump it, at least have Uncle Sam share the pain with you.
          Helping those who wear the white coat get a fair shake on Wall Street since 2011

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