Number one pet peeve of mine is calling life insurance an investment. A investment is something that starts small but over time builds up. Life insurance is the exact opposite. A big guaranteed payout that ether never increases or increases very little no matter how much money you invest. There is no investment fund in the world that will pay you out 100k after just paying $100 over a few months. But on the contrary there is no insurance policy that will give you a great ROP compared to a proper investment fund once you retire.
Life insurance policies are there to complete an existing investment fund, not replace it. It’s purpose is to be a contingency encase you pass away before your investment has a chance to take off.
You could dope the policy with some investment like features if having a policy that only pays out if you die rubs you the wrong way. A return of premium policy does what it says and returns your premium with no interest at the end of the term. Whole life builds up cash value that gets interest that you get when you cancel. Annuities run that cash value through the stock market. But still at the end of the day you’re better off putting the extra money you’re paying for these features into a separate investment fund.
Posted by lightgiver