Mind explaining exactly why? I read the article and it mentions no guaranteed cash value return - my policy would exactly have that, though. It has a guaranteed return and an expected return. And even the guaranteed return is that bad.
Keep in mind that this is Canada, not the US. There's also the whole pre-underwritten/post-underwritten difference.
Its just a terrible way to build wealth, and over the long term the stock market is not risky at all. Its simply not worth it (sure, it gets risky in those last 5 year you need to actualyl get it out, but by then you should have a good portion of it in bonds). You need to figure out the fees that those insurance policies are going to cost you and what fees your investment firm will charge you, along with the likely high cost funds that they will invest you in.
Fees will eat away at your money and earnings like no one's business and its simply not needed. You would be giving away money for no reason.
Amount invested : $50,000
Annual return : 6.00%
Projected expense ratio is : 2.50%
What if the expense ratio is : 0.25%
Your investment returns over 30 years will be $127,195 more if the actual expense ratio is 2.25 percentage point(s) less than the projected.
Projected expense ratio
Actual expense ratio
2.50% 0.25%
Net market value after Difference
1 year $51,750 $52,875 $1,125
5 years $59,384 $66,126 $6,742
10 years $70,530 $87,453 $16,923
15 years $83,767 $115,658 $31,891
20 years $99,489 $152,960 $53,471
30 years $140,340 $267,535 $127,195
I upped the expense ratio guess because Canada sucks like that for some reason
I looked at the graph and it confused me, and didnt want to take the time to figure it out, but I guarantee you that they will be making money off of you if you invest in life insurance, and definitely more money than an low cost index fund would cost you. Cut out the middle man and follow those videos above and you'll make/retain more money
