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URL:  http://boards.fool.com/tjscott0-asks-i-admit-that-im-scratching-my-head-29376966.aspx

Subject:  Re: money market alternatives Date:  6/23/2011  2:31 PM
Author:  intercst Number:  69176 of 75379

tjscott0 asks,

I admit that I'm scratching my head on how they are able to pay 7 or 8% on the cash value.

They're only paying "7% to 8%" for 1 to 3 years, but they're deducting a 3% to 4% annual "cost of insurance" from you in perpetuity that rises with age. If you live to be 100, it will be very expensive to keep the policy in force. Let it lapse, and you have a huge tax bill on any loans taken against the policy.

intercst
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