Life Insurance as an Investment – Dave Ramsey Rant
Life Insurance as an Investment – Dave Ramsey Rant
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he nevers answers te question, avoids it
Wooo. Eyes just opened
Sorry this guy doesnt have the best understanding of insurance industry.
Greatest life insurance…Jesus died for all mans sins if you believe Jesus died for you and trust in this to pay for your sins you shall be saved.Jesus is the door into heaven.
Aside from term, a property structured form of permanent life insurance can be a great compliment to a portion of an overall retirement plan. The main reason for this is for the LIVING BENEFITS. So yes, using life for all of your investments is not a good idea. Find a fiduciary advisor who doesn’t “sell” insurance but instead knows how and when to use it!
What is a ponzy sceme
$300 month into a couple good mutual funds will grow to a solid portfolio over a lifetime
“Better than I deserve” 💀
Life insurance technically isn’t an investment product, it’s an insurance product, just saying
👏🏻👏🏻
Whole life insurance is a financing mechanism and can be used to fund living expenses, debt repayments, major purchases, and alternative investments like real estate. An even bigger pro, are the mutual life insurance companies that are non direct recognition where the cash value earns dividends even while borrowing against the policy. The accessibility of money while earning interest is what separates a whole life policy from a 401k and a Roth IRA. It’s very difficult to access money in a 401k without getting penalized and with a Roth IRA, the moment contributions are withdrawn, the money stops earning interest. I do agree with Dave’s point about switching to term insurance when it comes to maximizing death benefit. If the goal is to obtain maximum death benefit coverage, than term is the way to go. If the goal is to create a more efficient financing system where dollars are recycled and recaptured, then incorporating a whole life policy (preferably one that is front loaded such as an early cash value or 10 pay policy) in a financial plan can be very beneficial and offer individuals more flexibility and control over their money. The purpose for my comment is strictly for discussion and education only. This is not financial advice.
@theramseyshow — How does life assurance compare to whole life insurance or just investing and saving?
You offer an incomplete representation of available LI products.
I’m not planning on buying life insurance. Whoever inherit my estate will get whatever assets and $$$ I got. That’s going to be a lot.
Dave Ramsey is talking bullshit. Term life insurance is good but its not the best for every situation. Whole life cash value can accumulate to substantial amount but its not meant to get you rich, its meant to give you options in your financial portfolio. Risk should be split in high, moderate and low. Cash value is a low risk strategy in the event you want to access capital to invest in a business or whatever you can borrow against it with flexibility in paying back. For example in COVID when stocks where down a lot of people surrendered their whole life policies and got substantial cash that was accumulating over time. It can also be use to supplement your retirement. In retirement income is the greatest asset an the more streams you have the better
So much if what Dave says I agree with. First and foremost, always go with independent brokers like BarrierLife or Dave Ramsey show advertiser, Zander. Be it BarrierLife or Zander, you’ll get quotes from various different companies without having to shop around.
Secondly, I agree, permanent life insurance isn’t really an investment. While yes you can potentially outpace inflation with your cash value and avoid paying taxes on that growth, there are better placed to put your money with will out perform whole life. I’m not sure about the 10-12% on mutual funds Dave talks about, but still potentially better ROI than whole life. Moreover, while unlikely with mutual funds, the investor is taking on the risk for the potential gains. With whole life insurance you’ve got guarentees never to loose all your money as long as you’re paying your premiums.
To help viewers skim through this, I’ve created some chapters for this video.
[0:02] Is Dave Ramsey’s Insurance Advice Right for Everyone?
[0:34] What’s This Portfolio-Based Permanent Insurance
[1:19] When to Consider Changing Your Financial Advisor
[2:05] The Trust Factor: Financial Advice from Family Friends
[2:51] Exploring Dave Ramsey’s One-Size-Fits-All Insurance Advice
[4:14] The Debate on Investment-Based Insurance: Missing Benefits?
[6:02] Closing Thoughts: The Universality of Dave Ramsey’s Advice
Ramsey wraps up the call with Britany and reiterates his stance on insurance, but leaves us wondering if his advice is the end-all-be-all solution. Moreover, where are these mutual fund that deliver 10-12%? Also, while he doesn’t own Zander, shouldn’t he share that his show receives support in form of advertising?
My LIRP has grown substantially, I do not know what this guy is thinking. We will be in a position to retire significantly sooner than we believed due to our LIRP. DO NOT LISTEN to this drivel. IF you make enough money and can fund your LIRP appropriately it is a HUGE tax benefit.
IULs have no penalties for making early withdrawals and the cash value within the IUL policy grows tax-deferred.
The math on life insurance never makes sense until you need it, but if you do, yes get term.
Only face amount will be paid? That’s not true. He needs to know how insurance is structured rather than giving audience generalized idea which is wrong. At least UL is different from what he has said.
The funny thing is people like to compare it to homeowners insurance and car insurance with short term insurance is they say..
They don’t realize they pay those insurances their whole entire adult life..
Most people do not stop paying your auto insurance and homeowners insurance at 20 years.. and invest the difference …they will probably be paying it for 60 plus years.. lol
I have basic term life insurance through Prudential paid for by my job. Pays 2X my annual salary but my job also offers basic supplemental that you can choose to pay for as well and it pays up to 10X my annual salary. I’ve been wondering if I should start paying for the supplemental or just call it a day with the insurance my job already pays for? The only thing I don’t like is that it cuts off at 85 so if I day at 86 my family gets nothing. That’s why I’ve been looking around at these videos to see what I should do.
So how do I get out of it now that I have put money in ever month?
I heard about when our pastor give a message about financial management sermon usually in month of January every year.
I had a policy in which I contributed 150
Premium monthly while part of the premium to
Be invested in S&P 500.
At the end of 20 years, I surrender the policy and got $100,600.00 check. I paid about Total of $39k in total premium over 20 years period while getting back $100,600 .00 back.
It turned out to be good investment for me.
I am writing this because you are saying never mix insurance and investment,
But in this case, it came out excellent.
How can explain this?
Let me get the commission by selling you Zanders Insurance
Life insurance, any thing with cash value is just the same thing dressed up differently. Sickening that life insurance agents won’t just call it what it is.
“I’ll bet he’s a friend, huh?”
-two minutes later
“Jeff Zander, he’s a personal friend”
What if you put it in a trust?
Only the sith deal in absolutes.
Do your homework! Dave is wrong! He doesn’t understand insurance and misquotes it all the time. Use caution before you follow his advice.
We’ve had people come to us with whole life policies where they’ve paid hundreds of thousands in premiums and have $0 cash value left over. It’s almost never worth it
That’s the advice I really needed 😍
….and there you are ?..LI salesperson.
Permanent insurance is not always a high rate of return investment play. You are oversimplifying the complexity financial planning. There are living benefit riders that over long term care coverage, critical care coverage etc. that covers your investments and the rest of your assets. Also mutual funds are expensive and do not tend to outperform benchmarks over time. ETFs and index funds may be much more suitable that mutual funds that have an upfront sales charge and an annual expense fee… AND can incur captial gains charges every year.
The good advisors appreciate it. Dave investment based life insurance is only effective for tax advantaged purposes for high net worth individuals. Selling it to the middle class as an investment is for commission
What if you get a whole life policy while in your 20s? My face amount is $30,000 premium is $32.60 and premium period is 42 years. Thru Colonial
Good ole northwestern mutual lol
You claim that banks don’t use life insurance to invest, but that’s simply not true. Banks actually allocate around $182 billion in Tier 1 assets into life insurance. It’s important to stop spreading misinformation. While whole life insurance may not be suitable for everyone, when done correctly, it can create tax-free assets that contribute to building wealth. I have clients who borrow from their policies to invest in other assets, all while still earning returns on the dividends. One client, in particular, borrows $200,000 to $400,000 per year and, through the arbitrage and tax savings offered by life insurance, earns an additional 3.6% on their money.
While I believe in diversification as the best strategy, it’s also true that the stock market can be risky—it’s like a casino. I had a client who followed your advice, retired around the time of the Great Recession, and ended up losing 35% of his stock portfolio. He had to come out of retirement and go back to work. So, Dave, you were wrong in that instance.
I respect a lot of what you say and appreciate the biblical principles you follow, but you’re not always right.
Hes married to a woman
Can you do a rant on LIRP is it worth it?
So if I had $10,000 worth of whole life value built up, what should I do with that?
Thanks for encouraging us to invest in life insurance! 😊 It’s great to know we can take steps to financially protect our families. 🙌
THANKS 🙏🏾 DAVE!!!
Hello
I have a 21 year daughter that have saved $25k and just got a raise and she was investing into this whole life and we are in need advise because she needs to cancel and invest elsewhere. Please help
Well he’s right about one thing….life insurance is not an investment.
But Ramsey is not a financial professional.
He’s a marketer.
He has no licenses or certifications.
He’s either a liar or he’s ignorant.
She needs to get a new laugh insurance advisor.
Not sure if mutual funds are superior to whole life insurance or lifetime guaranteed annuities
Im an insurance agent. I always sell a 20 year term with living benefits as long as the person qualifies. I let them know, is not an investment, is a protection of your income in case you get terminally ill. Average pay is around $250 a month for $200k life insurance, and over $300k in living benefits.
Isn’t the point of this being an investment to build cash value and borrow against it essentially just how the banks use our money?
Dave is totally wrong here.
He does not even understand why life insurance should be purchased in the first place. Insurance is done to protect against uncertainty in life.
In last two years, two of my relatives (who both were the primary bread winners) died. Just a month ago, if you had asked them, they wouldn’t have bothered about life insurance, but who knew within a month they will perish from a relatively curable illness. You never know what happens and when you may die.
Please don’t take insurance as an investment. It is for protection.