Subject: Re: Re: Re: Re: Term or Permanent?

Comments:
: Billy Bob, : Ok, so you're not a Primerica agent. To use your own words are you threatening to put a boot up my butt because this is the internet and I am also faceless? Anyway, let's move on. : You made this statement: : "OK then, are you saying term is right when you are young(er), then as you get old(er) a decreased amount of permanent is right? " : The rightness of any of this is also dependent on what the client wants. The old adage of, "you can lead a horse to water, but you can't make him drink", comes into play. The right thing for the agent to do is to explain to the client how each plan works and what the long term and short term implications are. The agent then can make his/her recommendation based on the clients current situation and also take into account possible future scenarios. Then let the client decide which route they want to take. If you have done that, (assuming no deceptive or misleading statements were made), then you have done your job. : You could pose this same question over at the financial planning board and you will get mixed results also and this is from fee-only financial planners. This is not meant to be confusing because the answer you get may not fit your financial situation and, therefore, you would argue against it. Unfortunately, there is no quick and painless answer to this question and because of this we agents are accused of ripping people off and being misleading. I tend to believe that there are more ethical agents out there than not. I say this because consumers are a lot more savvy than they were 30 years ago. : I would bet that you could go to two different financial planners and you would get two different plans. Does this mean one is right and the other is wrong? Not necessarily, and that is because there is more than one way to skin a cat. : I have a prime example of when term is wrong. When you have an estate planning issue and the client is concerned about estate taxes being paid by the heirs. The type of policy sold for this is a second-to-die policy and these are NOT term policies and that is because the client is covered until age 120. There is no term policy that goes beyond age 100. Term is no good for this because past a certain age all term policies convert to ART and that is extremely expensive. That is because we are talking about policies that have a face amount of multiple millions that will be used to pay estate taxes. There is more detail involved in this argument but ask any financial planner and they will tell you that term is the wrong type of policy to use to pay estate taxes. : In your discussion about "John" you talk about the 100K of insurance that he needs and you compare it to heart surgery. I wish I could use that comparison with my clients to make them understand the urgency of being properly insured. Unfortunately that analogy doesn't work well in this situation. Although I agree that we should help John re-do his budget to get what he needs, you can only push a client so far. Many are resistive to letting the agent know the full financial picture and some do not want advice on other areas of their finance. They want us to stick with the insurance. This other information is needed to properly advise them. Sometimes we are not able to give the client what they truly need due to budget constraints. So, instead of just walking away from them, we do what we can based on what we have to work with. : Sorry you didn't get the answer you were looking for but there is more than one right answer to the question. Some plans are good for the long term and some are good for the short term. It depends if the client takes a long-term or short-term view of their financial situation. : By the way, why are you trying to disprove Primerica's theories on Term insurance being the right thing 100% of the time?

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