A (3:49)
No thank you. Bizarro George, Hard pass. Although I gotta give him a shout out whatever product he's using. It's nice. Takes pride in his personal hygiene, has great hair. So did you get all that? Yeah. These products are super complicated and they love it that way. The more arrows the better. All right. They want this to sound so sophisticated that you just don't get it and you need to just believe them. It's got trust me Finance Pro energy all over it. But here's the main sales pitch. With this tax free income, no downside, and life insurance protection all rolled up into one beautiful product. But that's just the sales p and it's what the insurance agents who promote this crap want you to focus on. But they don't want you to focus on the downsides. In fact, they don't even want you to know about the downsides. Specifically, there are five things IUL agents don't want you to know. The first of which is that an IUL policy is not the same thing as an index fund. While the term indexed in index universal life does imply a connection to index funds, here's what's really happening. Instead of actually putting your money into the stock market, the insurance company uses a formula tied to a market index to usually the S&P 500 to decide how much cash value gets credited to your account. So if the S&P 500 goes up 20%, your account does too, right? No, wrong. That's because your return gets capped, like he mentioned, typically around 10 to 12% plus. And this is a huge deal. You don't get dividends and you can't reinvest them. That's a major source of long term growth in actual index investing. But in an IUL policy, those are off the table. So even though your returns are being linked to the market, you're not getting the full benefit of market growth. Not even close. In fact, Jeremy Schneider from Personal Finance Club bought an IUL policy and read the fine print just to see how bad the growth would be. And when he crunched the numbers, he saw that his policy would have an annual compound growth of 5.4%. So, bottom line, they want you to think you're getting a wizard with magic powers, but it's really just Jeff Goldblum behind a curtain and a really loud microphone. And even worse, it's like a TEMU version of Jeff Goldblum, which is me. No, the second thing IUL agents don't want you to know, your investments will get eaten up by fees. IULs are loaded with fees, all right? And not just one time setup fees. I'm talking ongoing built in costs that quietly eat into your cash value year after year. Things like administrative fees, premium load charges. Now you're probably wondering, well, where does the money to cover these fees come from? You guessed it, your cash value. So even if your policy is earning money based on index performance, that growth gets reduced even more or completely wiped out by fees before it ever lands in your account. Third thing, they don't want you to know. IUL premiums are outrageously overpriced, which is why they love selling them. It's not uncommon for IUL premiums to run 400 to 500 bucks a month, especially if the death benefit is significant or if the agent structured the policy to front load the Cash value. And as if that wasn't ridiculous enough, those premiums can actually go up as you age. Now, crafty IUL agents will tell you this isn't a big deal, since you can technically use the policy's cash value to cover the rising premiums later on. Here's the problem with that. If the market underperforms, or if the cash value isn't growing fast enough to cover those premiums, that strategy backfires spectacularly. And if that underperformance continues long enough, the policy will eventually run out of cash, which means you'd have to start writing massive checks to keep it alive. Otherwise, the whole thing collapses. And this is exactly what happened to Kyle Busch. To quote ap, he was instead told his money was going to the insurance company's account instead of being invested into a market. So his investment never went up as the market rose. Eventually, that lack of investment performance caused the policy to cannibalize itself. Trap number four with IULs, the cash value is basically a myth. A lot of people get excited about IULs because they hear there's an investment component. But what they don't realize is that depending on how your policy is written, your family might not get the cash value those investments have built up. When you die, they would just get the death benefit. Often the cash value goes, you guessed it, back to the insurance company. And even if they do give your family the cash value, it probably won't be much because of all the fees we talked about earlier. Which means the only way to benefit from your IUL investments is to take out a loan against the policy while you're still alive. That's right, taking out a loan from yourself. You're borrowing your own money and paying the insurance company interest to do so. It's like wining and dining an IRS auditor after they send you a tax bill. Unless you take them to Applebee's, in which case the punishment fits the crime. It's the tax man, and he's looking at you. And if you don't pay it back, here's what happens. They either take your loan balance from your death benefit or the remainder of your cash value. And if the loan gets too big and the cash value can't support it anymore, your policy can lapse entirely. Are you seeing a theme here? So when agents talk about IULs as wealth building tools, what they're really describing is a life insurance policy with a loan option. Not a savings account, not a retirement plan, and definitely not a good investment. Unlike buying a pair of men's bamboo joggers from Cozy Earth, one of the sponsors of today's video. When I get home after a long, exhausting day of making YouTube videos and a comfy chair inside a climate controlled studio, I am ready to relax. All right. These joggers are unbelievably soft. Make me feel like I'm sipping a pina colada on the beaches of Normandy. Hey, these days, actually it's pretty peaceful over there. Nice beaches. I also love their men's everywhere pants, their socks, and really just about anything they make. So go check it out for yourself. And you'll get 20% off when you go to cozyearth.com george and use promo code George at checkout. Or if you don't want to type things out, just click the link in the description below. And while you're out there avoiding IUL schemes, you can also avoid online spam and scam with the help of Deleteme, another sponsor of today's video and of this channel. Has there ever been someone you wish you could just delete from your life? Well, you need boundaries for that. But Delete me can remove your personal info from hundreds of data broker sites before they have a chance to sell it to online scammers. And that's a big deal, since AI is making those scammers way craftier these days. Deleteme will also send you a custom report every few months letting you know exactly what they've done. So you can get 20% off an annual plan by going to JoinDeleteMe.com George or use the link in the description below. All right, the fifth and final thing IUL agents don't want you to know. IUL benefits the agents way more than you. Yeah, this is the dirty little secret. They really don't want people to find out. Agents who sell IUL policies earn a crazy high commission, sometimes equal to 50 or 100% of your first year's premium. Which means if you're paying $6,000 a year into this thing, they're potentially pocketing between three to six grand before your cash value even gets off the ground. That is insane. And it's why these policies get pushed so hard. Not because they're great for customers, but because they're incredibly lucrative for the person selling them. And they're doing it with a product that's intentionally complicated, full of hidden fees, packed with fine print, and extremely difficult to exit once you've signed on the dotted line. And that exit is called surrendering your policy. And they call it that because you're about to lose a financial war and even waving the white flag is going to cost you on the way out. So there's five reasons to avoid Iuls completely. For my Gen Z audience it's giving scam and for my homeschool viewers, it's not a spirit you want to partner with. Hello homeschoolers. I am giving you the opportunity of a lifetime. But at the same time, the motivation for buying these policies makes sense. People want their families to be taken care of and they want to be financially secure in retirement. Well, what if I told you that you could address both of those concerns without having to buy a complicated scam adjacent insurance product? Well, here's how. When it comes to life insurance, all you need is a term life insurance policy. It's a fraction of the price of these crappy whole life policies and it will protect your family financially if something happens to you, helping them cover expenses and stay afloat. Which by the way is the only thing life insurance should do replace your income if you die. It should never be an investment vehicle. So when it comes to term life, here's what you want. You want a level term which means the premium will stay the same for the entire term. And you want that term to be 15 to 20 years. And you want the policy death benefit to be 10 to 12 times your annual income in coverage. So if your salary is $85,000, you'll want around 850 grand to a million dollars in coverage. And if you want to know the people that I trust and personally have coverage through, look no further than Zander Insurance. They are not a sponsor of this channel, not a sponsor of this episode. It's just the people that I personally use for the last decade. Plus they'll shop the top life insurance companies to make sure you get the exact coverage you need at the best price. So I'll drop a link in the description below if you want to check it out. Or you can just go to zander.com all right. Now what about the investing stuff? Well, you should never combine insurance and investing. All you need to invest is a tax advantaged retirement account. I'm talking 401ks, Roth IRAs, 403bs. Anything gets the job done. Open one either through work or a financial advisor or on your own if you feel competent and start investing 15% of your income each month once you're debt free and you have a fully funded emergency fund of three to six months of expenses. It's simple. It's boring. And that's how real millionaires build wealth. Not through these stupid policies. In fact, 80% of net worth millionaires, including me, said their employer sponsored retirement plan was the primary vehicle for building their wealth. And if you want to know how to get started on the same plan, I made this video breaking it all down. So click here to check it out next or use the link in the description. That's it for today. Be sure to hit like on this video, share with the person you know who's most likely to fall for this scam. And be sure to check out the comments section because I am sure the IOL agents have showed up to defend their honor. And talk about how he's not telling you the truth and it's a great product and he just doesn't understand it because he's too dense. I'm sure it'll be there. Thanks for watching. See you next time.
