is indexed universal life a bad retirement investment?

Answer 1

If you are asking about a life insurance policy than yes. If your are talking about the new mutual funds that are tied into the time frame that you should be retiring, than yes it is a good investment. The reason is that it will match the percentages with what a typically medium risky investor would do. If you want more comfort, go to the group that is older than you. If you want more risk, than go with the younger group.

Answer 2

Life insurance isn't a retirement investment no matter what they call it. Universal life is a form of "whole life" as opposed to term insurance. With whole life insurance, part of your premium goes toward a death benefit. The rest goes into cash value and Universal Life policies don't guarantee that cash value. Now, once you die, you are no longer considered retired. So what good would the death benefit do you when you ARE retired? If you're young, buy term insurance to cover your family if you die young. If you want to invest for retirement and you're young, you can start putting money into a 40l(k) or an IRA or some other vehicle and buy mutual funds or stocks or bonds. As you get older, your investments will become more conservative because you won't be able to make up any money you lose in the market before you reach retirement age. Universal life is purported to be a combination of stocks and death benefits. So much of your premiums go toward commissions to the sales person that it would break your heart. Most of the rest goes toward the death benefit and very little is left for investments. That is NOT a retirement plan.

Answer 3

In general, UL is not a good retirement investment. You do not provide enough info to give a good answer. How old are you? Have you considered other alternatives?
What is the policy indexed to? What are the guaranteed returns? What are the administrative costs of the policy? Do you have dependents?

Ask these questions to the insurance salesman and see what he says.