No. of Recommendations: 3
Hi Ray,
I can make this simple and short;

Maybe I'm wrong. Show me where. Show me what I've missed. Show me data data and analysis that demonstrates that IUL works better.

Scroll up just 5 posts to my most previous response.
The one where I linked the *last* time I showed you.
The data hasn't changed, nor have the results.

Here, I'll even make it so you don't have to scroll up for the link;

You're simply juggling numbers out of real sequential order, and confusing yourself. The order of returns (and losses) matters.

I notice that you didn't make any comment or come-back on the difference in final values between the S&P500 and the floored/capped strategy. A difference of growing a $10K initial investment from $37K to $70K would seem to be a big deal.
I didn't comment because its a bogus false dilema. There is no "difference" of a gain lost when you've been forced to liquidate your "buy and hold" portfolio during drawdown years. You're simply S.O.L.

Its the exact same argument that you always use for paying up the premium for a 30 FRM. Since these are the funds (or home) you rely upon for living within, you can't afford to lose them, not even "only once in a while."

Yup, I'll grant that the volatility of the S&P is high. I'll grant that some people may not be able to stomach that, and won't be able to sleep.
Mighty magnanimous of you.

Those people will have to decide if it's worth taking a $37,000 haircut to avoid the pain.
Except that they do not have to make that decision. The decision is whether they are willing to risk finding themselves "struck out at the bottom of the 9th" with a loss of their living funds when they no longer have the time or resources to recover, all in the hopes of chasing the rare home run return greater than the capped and floored approach.

FORTUNATELY, its really not even a decision of that... as the users of an IUL retain the freedom to pull liquid funds for superior side investments that have high probabilities of generating high returns... no penalties or restrictions incurred.

You can eat your cake, and have it too, without the tragedy of losing it passively as so many blind "buy and hold through the pain" investors have.

Dave Donhoff
Leverage Planner
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