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Author: ortman Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 17953  
Subject: My God.... another VUL inquiry? Date: 8/29/2000 8:41 PM
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Man, I think at least half of the posts on this board must be about VUL's. I apologize in advance for adding yet another.

I've read a good number of previous posts - and have developed (what I feel to be) a decent understanding of the product. I have come to the conclusion that the product IS NOT for me. However, my financial advisor had thought it may be appropiate - so I felt it wouldn't hurt to run my conclusion by a few unbiased people.

I'm 26 years old. I currently have no need for life insurance (no mortgage, wife, kids, etc.) However, I expect all of these items to occur over the next five years.

My 401(k) is maxed out (I put in 10%, my employer puts in 15%). I've maxing out a ROTH IRA to the extent that income limitations will allow. From work, I also receive life insurance in the amount of 1 times salary.

I have a decent amount of extra income which I need to invest. I think my financial advisor brought this product up to server my INVESTING needs more than my INSURANCE needs (which, from what I've read on this board, is incorrect).

I have compiled my own numbers comparing the results between the purchase of a VUL compared to investing in various mutual funds. Under the right circumstances (decent growth, high tax burden, etc) - the VUL was able to beat the mutual fund investing. However, if I used more tax efficent funds, then the mutual funds won out (due to lower expenses, and the fact that I'm not paying for insurance I dont' need).

So from a numbers standpoint, I'm not sold on a VUL.

The only other item I looked at was my insurability. It was mentioned that my insurability may change over time - making it more difficult to purchase such a policy later on if needed. However, this also didnt' seem like a worthy reason for purchasing a VUL.

I think I've answered my own question - there is no reason for my to purchase a VUL.

Am I missing anything at all?

Once again, sorry for the "me too" post. I hope I haven't asked anything that was answered 10 posts back.....

Thanks,
-Ortman
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