Should I invest in a Roth IRa or Variable Universal Life Insurance Policy?

Question

I have a 401k/ Not married, no children, but my advisor says it is wise to invest in a variable universal life policy while I am young (the premiums are lower) so it builds cash value to aid in retirement plus I will have the death benefit for later on when I am married and have kids. Susie Orman thinks this is a bad idea and that 401ks and Roth IRAs are the way to go. Other people think differently. I am confused on what to do and wonder if people who have actually signed up for a Variable Universal Life policy have actually seen the cash value results when they have retired. My illustration shows about $600,000 cash value when I am 70- that is with a 12% return. I am wondering if I should go with this policy or use the $200/month it would cost to fund this and invest it in a Roth IRA instead or put more towards my 401k. Any serious advice would help!

Answer 1

The general rule of thumb is to always max out your 401k and Roth IRA first. The advantage to doing this with a 401k is pretty obvious, in that your getting a tax advantage and your employer is giving you free money, through a match. The Roth will provide you with tax free income in retirement, and grows over the years at a relatively low expense cost when compared to a VUL.

After you've maxed these out, then it might be a good idea to look into alternative investments like a VUL. If insurance is important you can always get term insurance with very low premiums.

Answer 2

I recommend that you try this internet site where you can compare quotes from the best companies: http://INSURANCECOMPAREQUOTES.US/index.html?src=2YAbmuyAf9ov3

RE :Should I invest in a Roth IRa or Variable Universal Life Insurance Policy?
I have a 401k/ Not married, no children, but my advisor says it is wise to invest in a variable universal life policy while I am young (the premiums are lower) so it builds cash value to aid in retirement plus I will have the death benefit for later on when I am married and have kids. Susie Orman thinks this is a bad idea and that 401ks and Roth IRAs are the way to go. Other people think differently. I am confused on what to do and wonder if people who have actually signed up for a Variable Universal Life policy have actually seen the cash value results when they have retired. My illustration shows about $600,000 cash value when I am 70- that is with a 12% return. I am wondering if I should go with this policy or use the $200/month it would cost to fund this and invest it in a Roth IRA instead or put more towards my 401k. Any serious advice would help!
1 following

Answer 3

I recommend that you try this internet site where onel can compare quotes from the best companies: http://cheap-insure.info/index.html?src=5YAqqC1AOR8gjm1

RE :Should I invest in a Roth IRa or Variable Universal Life Insurance Policy?
I have a 401k/ Not married, no children, but my advisor says it is wise to invest in a variable universal life policy while I am young (the premiums are lower) so it builds cash value to aid in retirement plus I will have the death benefit for later on when I am married and have kids. Susie Orman thinks this is a bad idea and that 401ks and Roth IRAs are the way to go. Other people think differently. I am confused on what to do and wonder if people who have actually signed up for a Variable Universal Life policy have actually seen the cash value results when they have retired. My illustration shows about $600,000 cash value when I am 70- that is with a 12% return. I am wondering if I should go with this policy or use the $200/month it would cost to fund this and invest it in a Roth IRA instead or put more towards my 401k. Any serious advice would help!
1 following 1 answer

Answer 4

You might consider investing in both. I would suggest talking to a specialist at your bank, or your accountant.