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Advisors Resource

Buy Term, Invest the Difference

A Myth Dispelled

The Myth

Why do financial “gurus” and advisors recommend ‘buying term and investing the difference?’:

  • The financial gurus on TV and radio avoid the benefits of cash value life insurance because it is hard to explain and they typically are catering to the masses.
  • Some investment specialists do not understand how it work and typically focus on offence not on defense when it comes to growing wealth.
  • Many advisors believe by the time you are “retired” you will be “self-insured,” at that point your term will have expired. In many cases, people would still like to have insurance and can’t get it.

Demographics:

  • 30-60 years old
  • Interested in saving money for retirement

When Cash Value Life insurance Makes Sense:

  • For high income earners, the taxes that they pay on the growth of their investments is less than the expense inside of the life insurance.
  • If you think taxes will be higher in the future (i.e. concerns about: record levels of federal debt, record levels of federal spending, huge budget deficits.)
  • For young adults who do not have as much to invest solely in a life insurance policy, this strategy can lead to a greater return for a smaller amount of money.

Advantages of Cash Value Life Insurance

A cash value life insurance policy, specifically an IUL, can be designed to maximize cash value. This is done by reducing the death benefit to the lowest level while maintaining the tax benefits of life insurance. This will create the maximum amount of tax free income to be used during retirement.

annuities

Our proprietary proposal system will give you a customized proposal that demonstrates the power of this strategy. It will walk your client through their options and clearly show the advantage that cash value life life insurance may have over simple term insurance.

Download Sample Proposal

Our proprietary proposal system takes this strategy and brands it to your firm. You can select the demographic images, and the color scheme will match your branded colors. 

Download Sample

Do You HAVE AN ACTIVE CASE?

If you have an active case, you can request a customized proposal for your clients by clicking the button below.

Request a Proposal

Do You Want to Discuss any of our strategies?

If you would like to discuss this or any of our other strategies, feel free to set up a time to connect with our team.

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