Indexed Universal Life or Whole Life Insurance

All right, today we're gonna get into a topic that we've talked about before. This is a question that comes up a lot, Rob Gill. The people here are asking, they wanna know indexed universal life insurance or whole life insurance. To me, you know, one of the things that I think about is, you know, why is it one or the other, right? Why is it always gotta be this versus that? Why aren't we looking at these things and saying, well, this works for this person in this situation, this works for this person in this situation? No, that's good. First of all, thank you for the lead-in. I'm gonna tell a real story right now. It's when I partner Sean Callagy. Yeah. I love my brother to death, right? So every once in a while, somebody comes into the ecosystem, even if it's in our business. Right. And they'll say, hey, do you own universal? Or why do you own universal? Or do you own whole life? Or why do you own whole life? And it's like a general question. And Sean is phenomenal. He actually owns both, by the way, because of Eddie's point on how we kinda really diversified within his overall structure. But it's like somebody just kinda creates like a question. And the question could be created in the form of doubt. Yes. Or it could have been like a generalization. You know, it costs more as universal goes on. True. But if you overfund it early, if it's a high cash value, as you know, it's better. It's better in the long term. It protects you in the long term. So I think for myself and Ed, one of the things that we look at in general terms, we wanna make sure that if we're specific in the space of insurance, we wanna make sure that, okay, what is the person's risk tolerance? What kinda guarantees are they looking for? And then beyond that, do they really wanna be able to blend in some market performance? And I think in that space, to your point, Ed, if you wanna kinda break down the difference for the folks, I think that's where it becomes really fun. Right. I think where the real challenge lies in both of these products, especially in the indexed universal life space, is it's sold as one thing, but there's a lot more complexity to it than maybe even the agent will understand who are selling it, right? So as a consumer, you have to understand the ins and outs of anything that you're buying, the pros and cons of the products that you're looking at. And really, what do you want that money to do for you, right? So there is a space where whole life works really well. And for some people, they're saying, ah, well, I like this IUL because I have market participation. Well, you don't actually invest in the market. Your money earns interest based on market performance. Knowledge, just drop knowledge. Repeat that one more time. Yeah, so this is a big distinction, right? Because you're not actually invested in the market when you're in an IUL. What happens is your interest rate that your cash value is credited is based on market performance of that index, right? And what the insurance company will do is they'll say there's a cap on that, or we're only going to let you participate in a certain amount. So they put a ceiling on how much you can earn, but they also do put a floor, which is pretty nice, right? Because that floor says, hey, the worst case scenario is my interest rate that I earn is zero. Yeah, but that can't, just so we're clear, and tell me if I'm wrong, but I believe that that floor cannot protect you for the future cost of insurance. Well, and there's where the challenge lies. Once again, we're specifically folks talking about a universal policy. Right, the challenge lies in there's always a rising cost in the insurance, and if your death benefit and your cash value aren't coming closer together, right? So that death benefits here, but that cash value is not moving. Well, now the cost of insurance really starts to become a factor that can put a drag on that overall policy. Yeah, and just to kind of play a little bit, if you're a business owner that is in the top 1% or 1%, and we already have a whole life plan and in place, because what Eddie just described about the cost of insurance and being able to participate somewhat in what the market does, that's universal and not whole life, but let's play, you have a whole life policy, and now you wanna buy more insurance that yes, you wanna be able to take advantage of the market, but you also wanna make sure that you don't have to pay the big premiums that the bank pays for it. Specific to the product, you wanna go high cash value, premium finance on a universal to complement your whole life. That's high level planning, you can reach out to us privately on it. I just spoke about it in general terms, there's much more to it than that, but in this space of understanding how to kind of work within both policies, that's where you could create a lot of excitement. And with that being said, Ed, kind of go back to a little bit about whole life now. Right. Versus universal and then how it pertains to the folks. So one of the things that happens that's different with whole life and where it kind of gets a steady Eddie type feel. Steady Eddie. Is that whole life insurance has guarantees, right? Which indexed universal life does not have guarantees. So those guarantees mean that, you're going to have cash value growth. So where we talked about a worst case scenario and an IUL is you get zero interest rate credit. Well, right now by state law, you're going to have a guaranteed interest rate that comes inside of that whole life policy. So you mean on whole life by state law and by contract, because it is state specific. It is. You get that guarantee. It is, and you do have those guarantees in there. So you have that guarantee and then good whole life companies are mutual companies. And when you buy a whole life policy, you are now an owner of that mutual company. What that allows you is to participate in the profits of the insurance company and you get that in the form of a dividend. And that's why it's important that whenever you buy whole life insurance that you really understand the carrier. Yes. But to Ed's point, and listen, this goes back to the training, their sales training models in this industry is archaic. It goes back to the 1940s and 50s. Those same models don't work today. However, that's because nine and a half out of every 10 agents fail and they fail because they're not being trained properly. However, people buy products from new agents and to Ed's point, these agents are selling it based on who's training them, right? So it's important you get obviously educated. That's why you're on the channel listening right now but really make sure that you ask the right questions along the way so you have a clearer picture on what you're looking to accomplish. Absolutely. I always find that the way the question is posed back to how Rob started this off is that it's always kind of trying to pose one against the other and to almost say that like, oh, if you do this one, you're right or you're wrong or if you do this one, you're right or you're wrong. And really all of these products, no matter what they are, exist in the marketplace for a person, right? Otherwise they wouldn't be in the marketplace. The right thing to do is to sit down and first understand what your goals and objectives are for the money that you're putting towards these. And once you have that clearer picture working with the proper people to help guide you in the right direction as far as what's the best policy for you. For any of you folks out there that are looking for some more information and really wanna be able to connect with myself, Ed, or one of the team members at Epic, two things, number one, feel free to put questions below, share some successes as well. But more importantly, if you wanna talk to one of us, there's no obligation. Go ahead and click that link or give a phone call and somebody on the team will reach out to you and take you through the success process.