I am a consumer. Ed talks about life insurance as a tax free investment. A way to build wealth tax free. A way to have a guaranteed death benefit while having a life time access to your money. He suggests emptying your 401 and IRA and buying permanent life insurance. Don’t buy the cheapest policy buy try to put as much money as you can into the policy. Think of it as a savings account. Everything I am reading suggest differently. Please correct me if I am wrong.
Permanent life insurance is a policy with two parts; term insurance and cash value. You own the term insurance but the insurance company owns the cash value. You can either borrow against the cash value which will decrease the death benefit. You can also cash in the policy. I can not find anywhere that the cash value is yours to take as Ed suggest. The cash value of the policy does not get passed on to the beneficiary unless you pay dearly for a rider. So How does permanent life insurance build tax free wealth. I see more of a benefit in a whole life policy with no cash value – pay less premiums and pass on a tax free inheritance.