Does anybody who is pushing these do anything as simple as looking at the historical prices? Stupid quesiton, of course!'cause they'd see that from Mar 1987 to today, $100 in the S&P price-only grew to $436. But including dividends it grew to $813.A) what was the liquidity/volatility risks?B) what was the after tax returns?C) what were the costs to neutralize #A & #B in order to make it apples to apples?http://content.screencast.com/users/LeveragePlanner/folders/...1987 - 2002 = 0.42 advantage to the IULhttp://content.screencast.com/users/LeveragePlanner/folders/...2001 - 2012 = 6.47% advantage to the IULSo, yeah, over the long haul the IUL company keeps a lot of your money. They keep so much that they can easily give you a meaningless guarantee.The IUL company doesn't "keep any money" from the trades. Again, you could cook it yourself, you just can't get returns to compete with their existing long-term yield portfolios to anchor the safe leg of the hedged trade."Indexed universal life uses the S&P 500 index. (excluding dividends) as the benchmark for crediting their cash value." Actually, a single S&P500 account allotment is almost always available, but not the best more most stable performing choice. Usually an index blend is better.All it takes is for a quick look to see the effect over a long term.Indeed... talk is cheap... above are examples of actual results.Over the last 25 years, the return without-dividends was HALF the return with-dividends. Actually, worse than that. $100 grows to $436, for a profit of $336. $100 grows to $813 is a profit of $713. Not after taxes, fees, and costs of hedging to nullify volatility. Not anywhere near close.In addition to the fees & caps -- which in themselves cover all the company's expenses --Fees cover the companies' expenses, but caps are simply relfective of the hedged trades put in place. The companies don't take any margin out of the hedge trades.they keep 53% of the profit and give the customer the remaining 47%. That's a hell of a racket. No wonder they can provide a "guarantee". Math isn't a long suit of this argument, unfortunately. There are simply no outperforming alternatives available to the retail investor with the same features... not even on a DIY basis.If there were, they'd be trotted out here... but the silence tells it all.Dave DonhoffLeverage Planner
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