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Cath,

Somehow you missed a point I emphasized & reinforced several times;
The massive-gain opportunities are *LOW* risk, *HIGH* reward....

I know that this concept is hard to swallow at first... but risk and reward are *NOT* always directly at counterpoints. They diverge and align, creating mammoth opportunities... but usually only to the 1st responder, and they usually require very quick liquidity when the general markets happen to be down and everyone else is in distress.

Even if you are an "ordinary young person" (and I know many) getting started anytime over the last 13-15 years in a naked S&P position would be (and factually has been) extremely discouraging. IULs have outperformed during this time by leaps and bounds.

The so-called 'wallflowers' you seem to be describing as 'non wheeler-dealers' are even LESS likely to stomach 30-50% losses on an intermittent basis... and even further unlikely to sit still to simply "wait it out" despite the cash blood loss. Theyoverwhelmingly bail out to whatever else "feels safe" at that moment in time.

The naked S&P 500, with 50% drawdowns underneath a 10-13% potential upside is a trader's nightmare... but a casino's dream. The human tendency to respond to "sweepstakes attraction" means that (just as you have here) they look at what appears to be big juicy numbers, and ignore the underlying risks.

The risk of ruin at a Casino comes from the odds being stacked against the 'buy and hold' (or steady-eddie) gambler, multiplied by emotional weaknesses that the games are designed to exploit.

The risk of ruin in any naked buy & hold equities position comes *NOT* from trade odds stacked against the investor... but rather from external capital risks, and also emotional weaknesses that the markets naturally work against as well.

An IUL is just an off-the-shelf product of a hedged strategy. Its the strategy itself that is the foundation of an overall winner approach, for all the reasons I have explained. You don't need the insurance industry to do it... its just easier to buy retail than build yourself.

Dave Donhoff
Leverage Planner
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