Continue to Invest?

[GeoFisher]

Had no idea, is that even legal ??????

It depends on what your plan allows..........you can take loans against them. Now my plan has some "rules", like I cannot take a loan against matching funds, and I cannot take a loan against their 4% retirement funds, that ARE also a part of my 401K, but anything I've contributed, up to the vested value is FAIR GAME.

BUT not all companies allow this.......also, if I lose my job, the amount becomes due IMMEDIATELY.............that *****.

Later,

Geo

[know1]

Since I have a long way to go to retirement, I'm putting as much as I absolutely can into my retirement accounts. Heck, even if I were only 5 years from retirement, I'd be doing the same.

I'm buying lots of shares real cheap right now. Patience is a virtue.

[BUCKBASSKING]

I recently graduated this fall from the University of Louisville and started a career with Northwestern Mutual Financial Network. When I stepped out of college I was lost when it came to investments. I had an old 401k plan from a previous employer that didn't amount to anything and I was ready to get the ball rolling on my retirement. I am like you guys; I see myself sitting in a tree stand or casting from a boat in my later years.

I am 25 and now that I see what your priorities with investments should be I realize how little I really knew about investing. I recently started a whole life policy with Northwestern Mutual that gives me security now to take care of my family if something were to happen to me, and builds cash value and pays dividends to fund or supplement my retirement in the future. This gives me a great base to start my financial future.

You are never to old to start a life insurance policy. You can't pass on free money if your company matches on a retirement plan, but you can help supplement that retirement with a whole life policy in many different ways. If you guys have any questions about any of the information that I have talked about feel free to send me a PM or call me at 502-777-9605. My name is Chad Hack.

[cra97]

Chad, I am going to be polite since you are young and in the "Insurance Business", but whole life is the WORST possible investment a person can make!! I can prove it via any 20 year term in history you choose, including this one (which will scare business your way, albeit a bad move on their part). I have a brokerage license, so you know where I am coming from also, and would tell anyone on here I could take ANY SUM of money you want to invest and GUARANTEE you would not lose money with my "investment strategy". Anyone interested? Here it is (and for Chad's sake I will add a curve ball at the end to cover life-insurance needs too):

Lets say you have 10 years to retirement, or that's your investment timeframe, and you want to be in the market for growth, but want to make sure you don't lose a DIME of your investment, what do you do? Its simple. Let's say your starting with $100K, for ease of this example but it will work with most any amount, you look at the "10 yr ZERO Coupon bonds". Lets say a 1K bond, which is GUARANTEED by the government, is costing $500 (again for simplicity). You buy $100K in "face value" bonds, which will cost you $50K, to start. Now this means no matter what happens (barring the government going outta business, but lets not go there in this example) you are going to have your $100K at the end of 10 yrs, follow so far right? Now you have $50K to invest in whatever you choose to buy. Being smart, you are going to diversify into somewhere around 50% Stock (Big) Mutual Funds, 10% Sm/Mid Cap Funds, and 30% Bond Funds. In this case, even if the market went to ZERO, at the end of 10 years you still have your 100K in the account and it is guaranteed to be there by the government. ANY MONEY in the "investment" side of things is your "Gains" on your money. This works people, its how I used to invest for "scared" millionaires when I worked at a "trust" company.

Now, you need the insurance too? Ok, take a portion of that "Investable" $50K and buy a "paid-up" term life policy, but remember WHY you buy insurance and just how much you REALLY NEED. Don't listen to some insurance salesman tell you what HE/SHE THINKS you need, figure it up yourself like big people. You buy that and all is well there, then invest the rest as per the previous step I spoke of.

Listen, I don't mean to bash the insurance people, they need to make money too, just make sure you are buying something you: a. Understand. b. REALLY need. c. does not take a couple years to have ANY "real money" value (ie. whole life). Heck, they even have term-life policies out now that will REFUND YOUR MONEY, after a fixed period (like the 10 term policy) if you don't cash it....or DIE for those wondering I am willing to help anyone who asks for it for FREE!!! I am a disabled vet with nothing but time to kill, and kids to watch So if you want some help, or a second idea, let me know and I will happily give you some insight in exchange for a simple fishing tip or two in exchange. I can always learn more, and want to, about fishing and am just as willing to help you all with something like "Investing" if you need/want it. My number is 502-689-5528 and I work for "tips" )

Good luck and you can start bashing my post.......now.

Rob

[Devils Horse]

Why would your post get bashed? It's not really very rough on here, good people with the exception of myself, and the mods see that it stays fairly bland.

Your advice looks pretty sound, but the possibility of the government going bankrupt is real. Certainly any private person or company that operated the way they do would.

[know1]

Chad, I am going to be polite since you are young and in the "Insurance Business", but whole life is the WORST possible investment a person can make!! I can prove it via any 20 year term in history you choose, including this one (which will scare business your way, albeit a bad move on their part). I have a brokerage license, so you know where I am coming from also, and would tell anyone on here I could take ANY SUM of money you want to invest and GUARANTEE you would not lose money with my "investment strategy". Anyone interested? Here it is (and for Chad's sake I will add a curve ball at the end to cover life-insurance needs too):

Lets say you have 10 years to retirement, or that's your investment timeframe, and you want to be in the market for growth, but want to make sure you don't lose a DIME of your investment, what do you do? Its simple. Let's say your starting with $100K, for ease of this example but it will work with most any amount, you look at the "10 yr ZERO Coupon bonds". Lets say a 1K bond, which is GUARANTEED by the government, is costing $500 (again for simplicity). You buy $100K in "face value" bonds, which will cost you $50K, to start. Now this means no matter what happens (barring the government going outta business, but lets not go there in this example) you are going to have your $100K at the end of 10 yrs, follow so far right? Now you have $50K to invest in whatever you choose to buy. Being smart, you are going to diversify into somewhere around 50% Stock (Big) Mutual Funds, 10% Sm/Mid Cap Funds, and 30% Bond Funds. In this case, even if the market went to ZERO, at the end of 10 years you still have your 100K in the account and it is guaranteed to be there by the government. ANY MONEY in the "investment" side of things is your "Gains" on your money. This works people, its how I used to invest for "scared" millionaires when I worked at a "trust" company.

Now, you need the insurance too? Ok, take a portion of that "Investable" $50K and buy a "paid-up" term life policy, but remember WHY you buy insurance and just how much you REALLY NEED. Don't listen to some insurance salesman tell you what HE/SHE THINKS you need, figure it up yourself like big people. You buy that and all is well there, then invest the rest as per the previous step I spoke of.

Listen, I don't mean to bash the insurance people, they need to make money too, just make sure you are buying something you: a. Understand. b. REALLY need. c. does not take a couple years to have ANY "real money" value (ie. whole life). Heck, they even have term-life policies out now that will REFUND YOUR MONEY, after a fixed period (like the 10 term policy) if you don't cash it....or DIE for those wondering I am willing to help anyone who asks for it for FREE!!! I am a disabled vet with nothing but time to kill, and kids to watch So if you want some help, or a second idea, let me know and I will happily give you some insight in exchange for a simple fishing tip or two in exchange. I can always learn more, and want to, about fishing and am just as willing to help you all with something like "Investing" if you need/want it. My number is 502-689-5528 and I work for "tips" )

Good luck and you can start bashing my post.......now.

Rob

I agree 100%

[BUCKBASSKING]

cra97 please don't worry about hurting my feelings this is a public post. Your investment ideas sound great and I am not trying to doubt them but I don't know anybody that would actually take the time to do that but it is great to talk about. I know that you said that it does not take that much money to do but to really get the return on your investment you would have to have a pretty good sum to get results.

BUT when it comes to life insurance, term policies are like throwing money in the toilet. You are basically betting on your life. If you don't die within the terms timespan then you lose all the money you paid and get no benefits from the policy. With a whole life policy the security of having the protection for your family for the rest of your life is the main purpose the cash value that builds is an added bonus. I don't know what whole life policies you have been looking at but you may want to check out Northwestern Mutual's. We have paid more dividends the last 5 years than any other insurance company. Actually we paid more than the next four companies combined.

I would really like to know more about why you don't like whole life policies.

Chad Hack

[DJD]

Aren't the Whole Life Policies set up where you cannot withdraw YOUR cash value without paying a penalty....basically treated like a loan? But it's my money, right. Why do I need to borrow my money??

I also heard that if you die and your death benefit is 100k (example) and your cash value might be 10k the amount paid to your beneficiary would be 100k. The insurance keeps YOUR cash value. Is this true?

[BUCKBASSKING]

There is interest charged to the loans taken and the reason for that is because the cash value accumulated is used to purchase paid up insurance. As your cash value grows so does your death benefit. The cash value has to be there in order to keep the death benefit that has grown in force. The interest has to be paid but the principle does not, it will be taken off of the death benefit when you die if you choose that option. And you can have your dividends pay the interest.

To answer your second question your death benefit grows to offset the cash value. For example, and it will vary for different people, say you take out a $100,000 policy and after ten years you've accumulated $10,000 of cash value since the cash value is used to buy more insurance your death benefit has grown to $112,000.

The longer you have the policy in force the more your cash value grows and the more death benefit you accumulate. Say you took that policy out when you where 25 and never touched it just paying the premiums. At age 70 you would have $210,000 of cash value and $330,000 of death benefit. Your premiums would have never raised and you never have to pay another premium after you are 65, the benefit still grows and you have the policy for the rest of your life. By the way the total amount of money that you put in if you added all of the premiums together for the 45 years would be right around $45,000.

That was a very vague example but that is a whole life policy in a nut shell. Like I said the numbers will vary for different people according to your age and amount of insurance you take out. These policies are allot easier to show than to explain. So if any of you guys ever want to sit down with me I could give you the detailed version. We could talk about it on the boat, because hey that is what this site is all about.

[GeoFisher]

cra97 please don't worry about hurting my feelings this is a public post. Your investment ideas sound great and I am not trying to doubt them but I don't know anybody that would actually take the time to do that but it is great to talk about. I know that you said that it does not take that much money to do but to really get the return on your investment you would have to have a pretty good sum to get results.

BUT when it comes to life insurance, term policies are like throwing money in the toilet. You are basically betting on your life. If you don't die within the terms timespan then you lose all the money you paid and get no benefits from the policy. With a whole life policy the security of having the protection for your family for the rest of your life is the main purpose the cash value that builds is an added bonus. I don't know what whole life policies you have been looking at but you may want to check out Northwestern Mutual's. We have paid more dividends the last 5 years than any other insurance company. Actually we paid more than the next four companies combined.

I would really like to know more about why you don't like whole life policies.

Chad Hack

Sorry but Cash Value insurance policies are pure GARBAGE and about the worse investment instrument you can pick.

Life insurance if you ask me is supposed to be used as a "bridge" to sound financial stability, meaning......you get life insurance when your family will suffer if you die.........When I'm 65 or older, I will NOT need insurance, as my assets will be more than enough to bury me, and take care of my family.

You will NEVER be able to purchase and pay premiums on the amount of insurance necessary later in life............

Later,

Geo

[BUCKBASSKING]

That is great that you have that security, but you are one of few people that I know that has that. I know allot of people would love to be able to say that but most people cannot say that thier assets will be able to take care of their family in the case of thier loss.

You say after 65. I know that it is hard to admit and allot of people don't like to talk about it, or think this way, but not all people live to be 65. There are hundreds of people that die young everyday. I am not trying to scare anyone but it is just fact.

So would you be able to take care of them today if something were to happen?

Like I said earlier the whole life insurance policies are good for supplementing a retirement, some can fund the retirement, but the main reason for the whole life policies are to have that bridge to stability, and to have it when you die, to make sure that the money you put in is there when you die; not expired when you live past a certain point like a term policy.

Another thing that whole life policies do is give you access to that money that you are saving for your family, when you die, today. Instead of living off the interest that most people do in their senior years that principle is there to use if needed. It is fact that people are living longer today and a whole life policy will help ease the fear that the money that you have for retirement will run out before you die. And it offers a sizeable, tax free, guaranteed death benefit to pass along to your family.

No doubt the younger you are when you start the lower the premiums and the more time you are accumulating cash value. But the optionsare there for older people that do not have security.

[GeoFisher]

I'm not completely there.......and I carry a TON of term insurance..........10 times what I could afford effectively with WHOLE LIFE.......

AND I was a whole LOT closer to my goals 6 months ago...........**** economy is kicking my BUTT, as well as EVERYONE elses.


Granted those term policies are only good for another 25 years.....(until I'm 65), but most are LOCKED in on premiums........I KNOW what I'm paying, and the difference that I'm not paying on WHOLE life will more than TRIPLE my return on a good investment instrument versus WHOLE LIFE.

The long term plan is for me to be able to self insure my HEALTH, and Life Benefits.

Now granted..........I will STILL carry health insurance of some TYPE after 65, but I suspect my out of pocket for something SERIOUS could be 10 - 50K, but that is OK, as I'm planning for that.

Finally.........I'm currently looking into Long Term Nursing Care insurance.......that will be my next CRITICAL purchase, as the costs of long term care are HUGE.....sometimes as much as 60K or MORE a year.......

Didn't mean to ruffle any feathers....

Later,

Geo