Whole Life Insurance: Split Study - 20 YR Fund - Guarantees

Okay, so in this video We're going to look at the exact same situation as the last video 50 year old male Funding a policy with the exact same company 50,000 for seven years and then 20,000 thereafter The difference is we're only going to focus on the guarantees So we're going to completely strip the policy of the dividend And where this will be interesting, so if you recall on the overview video You've got your premium And pua component And dividend rates Are likely going to stay the same or go down over the next 10 years. That's our guess just from speaking with insurance companies They're concerned about that So this will show us much more transparency from a conservative Overview what split should I go with? So the dividend surplus Is more favorable to premium dollars the guarantee Is the same to both premium and pua dollars? So we've got the specs 4060 means a 20k base premium 1090 means 5k base premium Exact same funding as the last scenario. Let's dive in So There we go Here's our 4060 A lot of similarities here compared to the last video because it's the same policy 40 percent base premium 60 percent pua Guaranteed values the spreadsheet will show you the break-even point since we got to scroll down too far on this one Let's look at the 1090 10 percent base premium 90 percent pua It's closer to 88, 89 only because It does cover the term cost as well But here it's where it gets really interesting Break-even point Between years six and seven All right Let's look at the side by side here Just like all the other videos 4060 on the left Base premium 20 total outlay 50 for seven years and then 20 thereafter Cash value no dividend column in here because dividends don't exist when I only look at the guarantees worst case scenario It helps me understand how Rates are actually credited to base premium and pua dollars 1090 split obviously more up front Highlighted in yellow is my break-even point on the guarantees Okay Let's start to scroll down here So the 4060 breaks even in year 21 Not attractive at all You paid in 600 You've got 611 the cash value difference at that point the 1090 Same policy same individual same age same health rating. Everything's identical except for the design is different here drastic difference And when you really scroll down if we look at age 85 $265,000 more Than the 1090 split and this is what i'm looking at the guarantees So if you want to say hey, what's the worst case scenario? I want to play it as conservative as possible and look at the guarantees just like big banks and corporations do This is how you do it. So when we hear that the power Of the compound is in the base premium likely If anyone's stated that they're probably just used to selling Old-school life insurance policies or looking at illustrations from over the years where if you look at a basic dividend illustration That'll look like that's the truth. However, when you look at mechanically how life insurance policy functions If you've watched your boli study bullies function a lot like a big pua payment The more aggressive we can go with a pua split The more money we will we will have up front and then long term on a guaranteed basis as well very important to be aware of this this way I can See the different numbers and see what i'm taking out of policy Or if i'm an agent and i'm trying to maximize cash value for my consumer this way They don't find something better anywhere else or a competitor gets in there. This will help us understand how to do this Do that hope that hope this helps Hey guys, steve parisi here. If you enjoyed the content you just saw please subscribe Like and hit the notification bell for future videos If you'd like more information or to see some custom policies for yourself Feel free to call or email our offices at the contact information below