IUL – Indexed Universal Life Insurance – {IMPORTANT!} ☕Coffee With Carl Ep. 42 (New Series)
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IUL – Indexed Universal Life Insurance – {IMPORTANT!} ☕Coffee With Carl Ep. 42 (New Series)

(Upbeat music) Hello there and welcome to
another Coffee with Carl. My name is Carl Zoellner. I’m one of the attorneys with
Anderson Business Advisors, and today’s subject, we’re
going to talk a little bit about is Indexed Universal Life plans, or IUL’s. Those of you who have come to
one of our events are probably familiar with these as we
usually have one of our folks from our district company,
Anderson Financial Services, come in and talk about them
because they’re a great tool that a lot of people don’t
have the opportunity or are unaware of in the
ability to use these types of life insurance plans as an
additional funding source. I am not a licensed insurance
agent, nor do I want to be. But I think it helps to kind
of take the thirty-thousand foot view and take a look at
what these type of plans can do and who they may be appropriate
for or who’s used them for different purposes. I, myself, have one. I like it. I use it. Number one, as sort of a
term or life insurance policy since those of you who are
familiar with us know we do a ton of traveling and do
a lot of different classes all over the country. So I use it as a life insurance
policy that doesn’t have a term limit, as well as, down
the road and currently over fund it so that I can
actually borrow against it. There’s lots of different ways
to construct these IUL plans. If you’re interested in looking for one, it’s important that you actually
have your own individual consult with an insurance agent. Like I said, my preference is to use Anderson Financial Service,
and I did use them for my IUL plan because there are lots
of folks out there that sell IUL’s that structure it in
such a way where you’re not getting as much benefits as you could. So I can vouch for Anderson
Financial Services, however, those other insurance
agents out there may not- you’re sort of playing with
fire in my opinion as I’ve seen a lot of these come through,
where most of the funding isn’t actually benefiting the client. It’s actually benefiting the agent. So as fiduciaries, even through our Anderson Financial Services,
we are taking a look at your best interests. And for those who may not be
familiar with fiduciaries, I may even put together a video
talking a little bit about what a fiduciary is, versus
what a- let’s just say, what an ordinary person is,
in regards to other folks. So, IUL’s, for me, the simple
explanation is this when I say just have a term policy. My insurance I’m paying along the way. Then when I die, death benefit pay out. Okay? Now, in an IUL, the idea is to
actually over fund the policy so that I can actually borrow
against the death benefit meaning I’m over funding it, so it’s actually more of a
curve meaning I can borrow against it once there’s
enough money in there to borrow against. And it’s not dollar for dollar, so within the policy, that
dollar for dollar, you would be putting over funding or
putting money into it. But, as you put more money
into it, the death benefit goes up as well. So I can actually borrow
more money than I put into the policy and use it as an
additional funding source. Usually loans are pretty quick. Pretty low rate of interest. And you get the benefit of if you say, never pay the
load back, then that amount comes out of the end death benefit. And so, in essence, by putting
more money into these things, you’re creating an additional
funding source because number one you’re contributing
to own life insurance policy. Number two is you’re getting
more than a dollar for dollar benefit. And with the indexing in the
plan, you’re actually growing at a rate of interests so
meaning usually these funds get invested in say, a
conservative stock portfolio. What’s nice though with the
indexing is that you have caps, meaning, all of a sudden the
stock market crashes for some reason, you’re not going to lose money. The bottom cap is at zero. The top cap is usually right around 7%, so it can grow up to 7%
but what you’re missing is north of that. So if it grows 15% in a
year, then you’ve missed out on a little bit. But what it is is it’s a
security blanket for if something happens. On the negative term,
you’re also capped at 0%. So your max top is usually around 7%, bottom is zero. Meaning, you may not make
anything on it that year but you’re not actually losing money. So there’s lots of different
ways to use this really cool tool. Like I said, if you really
need an individual consultation because it is insurance, so some plans are required
medical exams some don’t. But what you want to do is sit
down with an insurance agent. My preference, like I said, is
Anderson Financial Services. They done a great job for me. And I’ve really taken some
great benefit out of having one of these. So I want to talk about a
little bit because sometimes you start tripping into these
things when you hit the Google so I wanted to make it
as simple as possible. As always, take advantage
of all of our free content whether it’s through YouTube,
one of our in-person classes, Toby’s Tax Tuesday, which is awesome. Until next time, thanks
for joining me with Coffee with Carl. (Upbeat music)

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