Speaker 1 00:00:08 What's up, everyone. Welcome to the finance for physicians podcast. I'm your host, Daniel Raimi. Join me as we dig into what it looks like for physicians to begin using their finances as a tool to live better lives. You can learn more about our
[email protected] let's. Jump into today's episode. What's up guys. So we're going to be getting into a big topic today. It's kind of a big topic. A lot of you have probably heard about permanent life insurance. It's big in that. It's, there's a lot to it. It's complicated. There's a lot of different, uh, strong opinions on it. And so we'll try to hit the high points and keep it, uh, fairly, uh, you know, kind of entry-level and talk about some of the basics of how it works, uh, make sure, kind of hit on some of the conflicts of interest and, uh, ideally give you some, some things to think about, uh, as you navigate, uh, the world of personal finance.
Speaker 1 00:01:06 There's a lot of people that, uh, tend to push permanent life insurance. I'll talk about that as well. And, um, hopefully give you kind of some of those tools to, to, to better navigate. So before I jump into that, uh, I mentioned this last episode, uh, two things, if you could help me with number one, let us know what format you liked the best we've been just early on in this kind of trying different formats. We've done, you know, interview podcasts, uh, with kind of the experts. We could also do interviews with physicians and talk about real-world stories. We've done solo podcasts, like this one where I talk about some basic personal finance content. We're also going to try out some Q and a sort of posts, uh, where we take some of the questions you guys have been asking and cover those specifically. Uh, so let us know if you have feedback on which one of those formats you'd like the best for now.
Speaker 1 00:02:00 We're just going to continue kind of trying out the different formats and see what seems to go over best for you guys. Cause that's, I would say that's most important. I enjoy talking about all this sort of stuff, but I want to make sure it's relevant for you. Second thing I was going to ask is if you can throw out specific questions you have, that would be much appreciated. So we'll make a, we'll put a link to the, uh, to the webpage in the show notes. Uh, but if you can go to finance for physicians.co/contact, like I said, it'll be linked in the show notes, but if you go to that page, there is a button on the left side, right under contact us, it says start recording and you can record a question. You have feel free to throw out a little tidbit about you, but, um, throughout a question you have on personal finance and we'll cover that in a future show.
Speaker 1 00:02:52 And so that would be great if you do that as well. So look forward to, uh, covering those. So yeah, permanent insurance, we're going to be covering today. We'll hit on the high points. Uh, talk a little bit about, uh, what to look for and how to navigate that. Okay. So permanent life insurance, we talked last episode about how to make sure you have the adequate amount of coverage. We talked about the high level, uh, how term works and we hit on just kind of the high points of, uh, how it compares to permanent life insurance. But today we're going to drill a little bit more into permanent life insurance itself and talk about why this might make sense or what, why you might want to avoid it. So permanent life insurance. So what are the high points? So coverage it's designed to be a permanent life, uh that's as a result of, uh, you know, just the structuring of it is it's a term it's basically a combination or a combining of term and investing.
Speaker 1 00:03:48 So you have the term coverage, that's just covering you in the event of unexpected death for the period of time, it's pure insurance, but with permanent, they introduced this an investment component. So you're putting more dollars in than it would normally cost, but that investment component builds up ideally to a point where it's kind of like self-insuring or self-sustaining so that it becomes something that's permanent. So it's typically considerable. It's going to be considerably more dollars required to make that work just because of the result or the nature of how it's structured, there's tax benefits associated with it. Typically you can take loans on it and take the basis out of the cash value anytime. So there's two components, there's the cash value component. That's how much it would be worth if you decided to cash it all out or take money out. And then there's the death benefit component.
Speaker 1 00:04:40 So that's the amount it's worth if you were to pass away. So the cash value component, you can tick, typically take loans out, uh, against that, uh, and then the basis. So that's the amount of money you put into it. You can typically just outright take out the amount you put in without any tax consequences, mainly because you've already paid tax on that money anyway. So there are some tax benefits associated with it, with it. There's also tax-free death benefits, uh that's with either permanent or term. So it's tax-free death benefits. So the gist of it is permanent is kind of like combination of term and investing so that it's designed to be a lifelong benefit, higher costs, and it comes with some tax benefits on the high level. It sounds kind of appealing, especially if you want to have coverage for forever. I mean, it's like, well, you know, that makes sense.
Speaker 1 00:05:31 I'd rather, I'd rather buy than buy a home instead of renting a home. Like I want to own it forever so that the concept makes sense. But there's, I mentioned in the last episode, there's definitely a lot more to the story and it's extremely complicated. So we're going to talk a little bit more about, you know, the other side of the story and try to give you kind of some of those main points to start to understand. I think the best way to look at this is how does buying permanent life insurance compare to buying term life insurance and investing or putting your money elsewhere? So option one is you buy permanent life insurance option two is you buy term life insurance and you do something else with the difference, like invest the money. So that's Dave Ramsey always has talked about buy term and invest the difference.
Speaker 1 00:06:18 So by term investor difference, we'll talk about that versus buying permanent. I think that's a good way to look at it because if you can buy term and invest the difference and if the investment grows so that it's ultimately more valuable than the permanent life insurance, then that scenario makes no sense to buy the permanent. But like I said, it gets a little complicated. So let's start out with kind of a straightforward example. Let's say you have $10,000 and you could hypothetically, let's just say you can buy the term coverage that you need for a thousand dollars. And then that leaves $9,000 to invest, or maybe you could buy a permanent life insurance for $10,000. So how do those two scenarios compare? So that's, that's the frame of thought. I think you need to be looking at if you're considering permanent versus term is how do those two scenarios compare?
Speaker 1 00:07:13 So I think the first big point to keep in mind with permanent life insurance is you have to keep it for a really, really long time for it to do even like modestly, okay. And sometimes it's still even terrible, but it takes a really, really long time for it to end up doing better than the whole buy term and invest. It just takes a long time to do its thing. So you, you're probably thinking why, why does it take so long? The main reason is the upfront costs. So the insurance agent that's the, the bulk of the cost is the commissions to sell it. And so the insurance agent commissions are typically 50 to a hundred percent of the annual cost. So going back to that scenario, let's say you have $10,000. If the commissions on it are a hundred percent, they're paying the agent $10,000 to sell it.
Speaker 1 00:08:07 So like there's no money left over to have a cash value like insurance. Company's not gonna. So if you look at an illustration, have you ever looked at these illustrations for permanent life insurance? You'll always see how in the first year, especially it's like you put in a whole bunch of money and there's not really any cash value. Sometimes they'll show you having cash value, but there's a surrender charge. So in reality, you still don't have any cash value because you can't get to it if you get rid of it. So if you look at these illustrations in the first year, it's typically like zero cash value or some low number, basically because they had to use all your money in the first year to pay the agent to sell it. Fortunately, it's not like that every year vintages be, you know, never a good vehicle, but, um, there's a huge upfront, uh, commission hurdle that you have to jump.
Speaker 1 00:09:03 And that makes the costs extremely, you know, that's, uh, that makes the return. It just terrible at first. And that's, so that's the number one reason why it takes a long time to do well is because you have to kind of recoup all that upfront costs. I remember as an agent trying to sell these products early on, especially early on it's it's it was, I was just uncomfortable talking about, especially the early years when I would show Northwestern mutual. Um, and most of the big insurance companies, you know, they teach the agents how to go through the illustrations and explain how they work. Um, I was always uncomfortable, especially going through the early years because it just looked terrible. It's like, and then it just begs the question, like, why is it so terrible upfront? And the real answer is, cause I get paid so much money to sell it.
Speaker 1 00:09:54 And that's just, I mean, nobody really, it's just not an enjoyable thing to say. And that got us that got even worse when I was, you know, the, her quote adviser. So most of it was going to ultimately me and the company and kind of the, the sales cost of distributing the product, the other big thing, uh, this is important to know, especially if you're serious about getting this, a lot of these products, you can, uh, play with how those costs work as an agent. So you can, uh, restructure the policy to where there's lower costs or higher costs, which is not a great thing. That's a bad, that's a big time conflict of interest. But knowing that as a consumer, if you're serious about this kind of product, you need to make sure that you're getting it designed to be as lean as possible in other words, as low a commission as possible.
Speaker 1 00:10:46 And so that just keep that in mind is when you're getting it on the front end, if you are serious about getting it, we'll talk about why you might want to get it versus not get it more. But if you are going to go down that path, you want to make sure it's like lean and mean, and, and as little of commissions as possible. And typically the way to do that is to, uh, verify from an independent source, because the problem with that is the agent selling it. The, the leaner, they make it, the less they get paid and it's substantially less. So there's, there's an incentive to not make it lean. So a couple of examples on like timeframe going back to the $10,000, let's say you have $10,000 to do something with, you know, you need term life insurance, but you're thinking about term versus permanent.
Speaker 1 00:11:26 So let's talk about that short, short term timeframe. Cause I think this is most straightforward. So let's say you have one, we're looking at this from a one-year timeframe. So over the course of one year, uh, scenario one, you buy the permanent life insurance, $10,000 scenario two, you buy the term 1000 and invest the $9,000. So in this scenario, pretty much a certainty like the permanent life insurance going to look terrible, I think like best case scenario it's, it's got like a 50% loss. So it's, and this is best case it's probably, uh, after a year it's probably worth you. So you put in 10, it's probably worth between zero and $5,000. So best case 50% loss, minimum. So compared to the investment, I mean, you know, it depends on where he invested, but if you put it in a savings account, so, or $10,001, I dunno, uh, at least it's got its value, but even if you invested in like a very aggressive, like a solid, you know, lead diversified investment that has good earning potential.
Speaker 1 00:12:32 And let's just say the timing's bad and it's a terrible market, like 2008 repeats itself. Even in that scenario, you're probably gonna lose like 40%, maybe 50% at most. And that's like the worst year in the past 20 years I can think of. And then the other years looked really good on average. So it's basically, uh, you, you would have to have the worst case possible year, uh, in the investment alternative for it to break even with the permanent life insurance. Um, and in that, and that's like kind of the best case scenario for the, uh, uh, the permanent life insurance. Because if it's like a hundred percent loss, if it's one that has a hundred percent commissions, it's still gonna look way worse than the investment. So over a year timeframe, permanent life insurance is about the worst investment you could possibly come up with.
Speaker 1 00:13:22 It's terrible. You would never want to do it for a year. And anybody that told you, you should do it for a year is just lost their mind. So that's going back to the biggest hurdle is it takes a really long time to kind of do its thing. So let's switch to kind of like a five-year timeframe. So five years typically, how do these look? So investing 10,000 versus buying term a thousand and investing the $9,000 typically over that timeframe, you know, that big hump you had to get over the permanent life. Insurance still looks pretty stinking lousy. Like a lot of times it's, especially if you had like the a hundred percent commission type of setup, like a very inefficient or a, a high commission product still might be like 50% worth, 50% less than what you put in. And so that's, that's a pretty lousy investment.
Speaker 1 00:14:10 Um, so it's almost always the worst possible investment still over five-year timeframe. Um, it's, it's extremely rare. I don't think I've ever seen it where it's worth, it's broken even where it's worth, what you put in. It's, it's pretty much a big loser after five years, almost always. Um, so not, but it's not quite as terrible as a one-year timeframe. Uh, but it's still, you know, very terrible 10 years is about the timeframe where it starts to the typical, like, and this is probably like a, well-designed one like a lower commission product. So typically a 10 years is about the timeframe where that scenario, where you buy permanent, um, and have it for, you know, you've put in the 10,000 per year for 10 years. So you put in a hundred thousand dollars and maybe it's worth around a hundred thousand dollars. So that's when you typically see them in the break, even range around that Tim year, 10 year timeframe.
Speaker 1 00:15:03 And that's for a well-designed one. Now, if it's a poorly designed one, it takes a lot longer even than that. So let's compare that with an investment like over a 10 year timeframe, breakeven is, uh, X is extremely rare. It's possible that your investment could break even over a 10 year period, but it's, it would be difficult to find a 10 year timeframe, even on the most risky investments that have, that have a 10 year timeframe. That is a breakeven. Now you could just do, you could gamble with your money and lose money over 10 years. But if you're, if you're wise with your investments over a 10 year timeframe, you should not expect breakeven for an investment, uh, that is wisely, diversified and is efficiently invested. It's just, it's not a very, uh, it's a very unlikely scenario, but it's not as bad as the one year in time.
Speaker 1 00:15:55 Your timeframe we're starting to kind of get in the realm of like it's even worth comparing, but it's like nine and a half times out of 10. The investment scenario is, is, is going to look much better, um, because it's going to have some return. So buying term and investing the difference it's going to have typically looked much better over that 10 year timeframe than just buying permanent. So if we fast, if we fast forward to like a 30 year timeframe, that's where, uh, permanent life insurance kinda is hitting its stride and starting to, uh, show returns like actual positive returns. And they're kind of in line with their like decent, I guess. Uh, but the problem is that they're still pretty substantial underlying like ongoing costs that are typically higher than like a low cost investment alternative. And you still have that upfront big hurdle you had to jump.
Speaker 1 00:16:46 And so 30 years is, can be, it can be long enough timeframe to start to shift, uh, the, uh, benefits towards having permanent life insurance. But I would say it's a rare case for most people. Uh, it depends on what the investment alternative is, and it depends on circumstances. And so this gets starts to get into the timeframe where I don't know, like probably 95% of situations, you should still buy term and invest the difference, but there's, I can come up with like 5% scenarios where permanent life insurance starts to make more sense, uh, because of the long time horizon and the situation. And I'll kind of hit on those in a minute. I think the, the key though is it takes us really, really, really long time to break even. And it's like predictable, you know, it's gonna take a long time. It's extremely lousy.
Speaker 1 00:17:41 Uh, it's an extremely lousy investment on the front end. So what happens is a lot of times people don't realize how terrible it is in that shorter timeframe. Once they realize how terrible it is, they get rid of it, uh, at about the worst possible time. And they have a huge loss. So ideally you go in the front end, you kind of hit that. You kind of go in with eyes wide open. Knowing what that focal point is is that this is a huge hurdle. You have to jump, it's going to take a really, really long time for it to perform. And you need to be able to have that time. Like you need to be able to not need the money and you need to be able to let it do its thing for a really, really, really long time and not touch it and keep funding it every year and every year, even then though it still might not be the best thing for your situation. And then the reason, the main reason that's occurring is those costs. So going back to the costs, if there were products that we could get rid of those costs, or, you know, at minimum, get rid of the agent commissions,
Speaker 2 00:18:41 This thing would look a whole lot better for a whole lot more people,
Speaker 1 00:18:45 But we haven't quite gotten there yet within the industry. Um, I'm hopeful that that's going to happen. Um, I'm confident they're going to start to exist policies that that will exist, that are no commission policies. Uh, there were, there actually was one that existed for a little while. Tia Cref had one, they pulled it out, they stopped distributing it. Um, I think the issue has been that nobody was selling it. There's been no, uh, incentive to sell it. So this is a complex vehicle and it takes, they have to pay somebody or somebody has to have the incentive to sell it. So our industry financial services has been, like I mentioned, they've, they've had conflicts of interest and been, uh, prone to, uh, embracing the conflicts and doing things like selling life insurance while also providing advice. And so there is a problem when you, you're not going to want to sell a no commission product ever.
Speaker 1 00:19:42 So the problem has been, most advisors get paid to sell life insurance. So they're not going to ever want to sell no commission life insurance, but what's happened within the industry is there's a trend towards advisors that don't sell products. And so they're going to be more apt to want to sell this. So reason I say all that is because I think in the near term, there will start to be products that exist that will have much, much lower commissions or even no commissions. And so if you can find, if you can find a true, no commission, permanent life insurance, it'll make it a
Speaker 2 00:20:14 Whole lot more appealing for more of you
Speaker 1 00:20:17 And be a much better case. But until then, it's very, very difficult to make this, uh, you know, a wise investment, uh, relative to what's what's out there. So I think where it's an obvious, just terrible lousy investment, even if you keep it a long time is when you have so a couple of scenarios. So let's say you have credit card debt, like an existing balance. It's always going to be better to pay off the credit card debt and get term life insurance. Like that's a very wise investment to avoid 25% interest, uh, or future 25% interest rates. So that's a no-brainer, uh, let's say you have no emergency reserves. That's not as much about return on investment, but that's about like risk in your life. Like you need to have some reserves to be able to like sustain unexpected, or maybe you're not maxing out some of the easy, uh, tax shelters that exist like Roth IRA or HSA 401k four, three B, those sorts of things.
Speaker 1 00:21:14 Those, uh, have built in tax shelters already. Let's say you can buy term and invest in a Roth IRA because the Roth IRA has those built-in tax shelters already. It's gonna perform much more efficiently. And the appeal of the permanent life insurance tax benefits are much lesser because you already we'll see some of those tax benefits built into the alternative vehicle, or maybe you're not saving enough for education. Um, and you can use like a five 29 that has built in tax shelters as well. So I think in those cases, you should really lean heavily towards buying term and putting your money into those sorts of things. First now, where it gets, it gets more complicated when you're, uh, when you've maxed all those out and you have kind of all your ducks in a row and you have plenty of wealth. And like I said, still not straightforward.
Speaker 1 00:22:06 Uh, but it, it does make it a little bit more like you need to understand the numbers and kind of your preferences and we'll circle back to that in a minute. So the second thing, big thing I wanted to point out is that the, the, uh, people that sell this will often push it very hard. And I've already mentioned some of the, uh, uh, conflicts in this episode, in the prior episode of interest that exist. But, um, basically there's a ton of commission, uh, commissions, you get paid on this, so there's a lot of incentive to push it. And there's a lot of incentive to push certain types of it. And it directly translates to worse for you. Like the more that's paid to the agent, the worse it is for you in general. Like if you can. So within different types of permanent life insurance, like you can see, you can, you could find like five different variations of it, each paying, uh, different commission percentages.
Speaker 1 00:23:00 And that will typically translate to a direct correlation to how much cash value you build up. So anytime you have this sort of high commission set up on something, it's really going to drive behaviors. Even if people are like, perfect, you know, are honest, you know, very good people. They're humans too. Like at the end of the day, like humans just incentives will affect you. And so agents know people have this negative kind of connotation to like, they, they're not like ignorant about it. Like, so things like whole life has a negative connotation to some people. So they're going to come up with creative names, um, like a bank on yourself. That's kind of a common, that's more of like a idea, I guess, but variable universal life, um, SERP plans, VUL variable, universal life that's abbreviation, whole life is, is kind of like not use very often because of the negative connotation, but there's a million different things you can call it, like, so it gets confusing there.
Speaker 1 00:23:57 But, uh, th you'll see some variations and they'll say that it's different because it's just, but at the end of the day, it's the kind of, the core of it is it's either a permanent or it's term. And if it's permanent, it's in an agent is involved with it, or someone is, uh, selling it to you. It's going to have a high commission on it, much higher than a buying term. I think it's pretty obvious though, in these situations where, uh, like with, you're not maxing out stuff, you have credit card debt, you need to fund your EAF fund. Those sorts of things I think are straightforward. Like pretty obvious to buy term, invest the difference, but it gets a little bit, it gets a little bit more complicated, like I said, when, when you get outside of that scenario. So I think this, uh, this will depend on, you know, what you need the funds for and what they're going to be used for.
Speaker 1 00:24:46 Ultimately what it typically comes down to is so permanent life insurance has some built-in tax benefits. So what it typically comes down to is are those long-term tax savings going to outweigh the high insurance costs or commission costs. The second big thing is, do you have the time, like, is it going to be in place long enough for it to do its thing? So are those tax benefits going to outweigh those insurance costs and can, is the time horizon long enough, like for very high certainty to let it do its thing. The other side note I would make is there are special circumstances where it can make sense, like in a business when you need to buy out an owner and there's no ability to finance it otherwise, or in family planning, like with a farm that's illiquid wood, very illiquid assets. Sometimes you it's D it's, it's, uh, a good strategy to consider having this sort of a vehicle, uh, is a liquidity, uh, providing tool at death.
Speaker 1 00:25:53 But, um, I think it's, it's a much smaller pool of a population that, uh, should even consider this sort of vehicle. And what happens is when we talk through it with people is, uh, the time horizon thing gets a lot of people. Cause we work in our planning firm with a lot of younger folks. And I'm sure a lot of you guys you're younger as well. And when you're younger and you're building up wealth, you're like, well, I don't, you know, I might need it, or I don't know if I'm going to have the time. And so when you don't have a time horizon there necessary to let it do its thing that that's a disqualifier, even if you've kind of maxed out everything else, but even then it, maybe you run the numbers and we look at those and we're like, well, it's actually still kind of a toss up between investing and buying term and buying permanent.
Speaker 1 00:26:40 So like, why would I go through the long horizon thing and kind of lock up my money or, you know, go through this big, you know, expected, hit on the front end and why would I go through that when I could just invest in it, doesn't have that. And it's not that different. So it's, and there's, there's very few people that have these special circumstances where it's like, I have a business that I need to use this as a vehicle to transition equity or family planning where I have the farm. So there are also some state situations where like a state taxation, you know, this can be a vehicle used in that sort of situation, but it's extremely rare. Um, I would say, you know, 95% minimum, uh, should be leaning heavily towards buying term and doing something else with the money. Uh, and the rest, the 5% should really run the numbers and understand it first, before they even consider doing it. So a cup, a couple of questions, that's kind of the high points of, uh, of how permanent life insurance works and who it might be beneficial for or what kind of the hurdles are to starting to entertain the idea of, of considering it. But what if you already own it and you've maybe owned it for a short period of time. Like if it's, if it's, uh,
Speaker 3 00:27:56 The shorter, the time period you've owned
Speaker 1 00:27:59 It, the better, the better it might be. If you, if, you know, you need to get rid of it. So let's say you bought it and you shouldn't have bought it. So let's say you have credit card debt with a super high interest rate and you bought permanent life insurance. Like that's probably not the best use of your dollar. And it just, somebody sold it to you and, you know, it was not the right thing to do. And you've fortunately you realized it and you're there. So you're like, what do I do this? Well, hopefully it's early on
Speaker 3 00:28:26 In it. And the earlier the better,
Speaker 1 00:28:29 Because you can kind of nip some of those front end costs and call it quits on it and, uh, kind of cut your losses fast. And so you definitely want to, uh, understand what, uh, what that looks like. But the earlier the better, like if it's like three months into it, it's going to be not near as big of a deal. It's going to be an easier decision, but what if you've owned it for a while? So like the scenario where you've owned it for like 10 years, that's a much harder scenario to look at because you've kind of already gotten past all the front end costs. And so that's going to be really more of like a, let's look at the numbers and your situation. And it's not always a like, let's can it and just toss it out. There's a few different options.
Speaker 1 00:29:12 Maybe it is best for your situation. Um, I would have to guess that it's unlikely just because there's so few people that really benefit from it. If I'm talking to the averages, even the average physician, but, um, maybe there's a chance you could, you should continue funding it and it's the best vehicle for your situation. That'd be one option, but more likely it's probably not the best setup. And so in that situation, maybe you just stop paying it and you can turn it into like what's called paid up. That means you, you know, basically no longer fund it forever. And it just sits there with the cash value as is, and it grows based on the growth rate and you don't fund it anymore, but it just kind of does its thing as if it's kind of like fully, you know, its funding is now done.
Speaker 1 00:29:58 They restructure it. And it just does its thing as if there's no more funds going into it. It's basically a good way to kind of, you know, leave it as is. It'd be like, uh, you know, stopping funding of a 401k plan. It's going to stop growing by a much larger, it's gonna not grow nearly as fast, but it will still grow based on the balance of what's already in there. It can work well, if, if the cash value that's already in there is beneficial, but that you don't want to continue funding it. That's kind of this ideal scenario for that setup. Or maybe you cash the thing out. Like that's, that's kinda, that's another alternative, even if it's been a longer time period and you run the numbers and you're like, well, there's, I got three or four alternatives that are clearly better than this.
Speaker 1 00:30:42 Uh, let's cash it out and, uh, put those put re divert the funds to those places. But when it gets the longer you've held it basically the longer you've held it, the more likely it would be to probably hang on to it in some capacity. Uh, and the more likely you should be cautious with getting rid of it. Another scenario we see sometimes is maybe your employer's providing it for you. Now, if they're funding a hundred percent of it, like that's, you know, he might as well take it. So that's, you're not paying for it. They're paying for it. Uh, might as well take it. It's all good. Now, if you're going to have to pay for it, it depends. Like it depends on, I mean, if you're having to pay for all of it, then it's just the same thing as analyzing it as an individual or a personal decision.
Speaker 1 00:31:21 And other times people maybe bring up, well, what if I want to have the forced savings? So a lot of insurance agents or advisors selling this will say, you know, this is a good vehicle to force savings. And so that, that's a good point. I mean, it is a good vehicle to, for savings because you aren't going to not pay the premiums on your life insurance. But I think there's alternatives that are there that can be, um, you know, equal to that. Like maybe not quite as good, but like 401k plans through work that's, you can kind of make that autopilot. You can force yourself to save, but if you truly do need that, and that is effective for you, I mean, that could be a good case, but I would say, I think that's something to work on. That's like a separate issue. I think you should work on.
Speaker 1 00:32:09 Uh, but at the end of the day, if that is a need, that can be a handy little, uh, side note of, of being able to, or of use using permanent life insurance. But I don't think people, as many people truly need that as is, as one might say. So I think at the end of the day, though, the, the key is understanding it, uh, it's, it's super complicated vehicle and when it's complex, it's typically going to favor the person selling it. And so in summary, I would say it's important to understand those conflicts and especially with the person that's proposing the idea and understand those conflicts and understand kind of where their incentives lie and really think about, you know, why it makes sense to run the numbers, understand the product. You need to be able to explain it yourself and understand the basics yourself.
Speaker 1 00:33:01 It's something I would get a second opinion on, especially if we're talking big dollar amounts, like get, have an advisor that doesn't sell it. Uh, look at it. You can reach out to our firm like we'll do like a no-cost consult, like, especially if you're about to get sold a big, huge, permanent life insurance policy, just, that's a good opportunity to like, get a second opinion and see what they say. And they'll at least give you some considerations to think about before you pull the trigger on it, because it's a, it's a big decision, um, for it to work well, you need to be committed for the long haul. It needs to be a longterm decision. Um, it can work well in certain situations, but it needs to be for a very long period of time. And it is fairly rare that there all the factors are in place where it's going to work well. So, uh, that is the high level on permanent life insurance. Um, hope it's been helpful. We can, uh, dig in. I don't don't want to dig in too deep cause this, this starts to get intense here with permanent life insurance. There's all kinds of different variations and details and that sort of thing. But, um, let me know if you want to get into any of that, I'm happy to give it in future episodes. Hope it's been helpful and look forward to
Speaker 4 00:34:06 Talking to you next time as always, thank you so much for joining us today. If you found this valuable, please give us a review on iTunes and share with a friend. Also check out our
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