TA: GVUL
10-27-2023 | 11:22 AM
#101
Kerbal Rocket Surgeon
Joined: Dec 2007
Posts: 1,099
Likes: 0
From: DTW 717A
I’m planning to run that illustration when I get some time. For easy math let’s say my current imputed is $1150/yr in income. Let’s make math easy and say marginal tax rate is 30%. Current plan is costing $350/yr in taxes. The GVUL imputed drops that to $350/yr and a tax bill of $105. So a $245 difference a year in my cost for the same coverage (subject to go up in each 5year age band). Now, if I put $245/yr into a 4% investment, minus a 2.25% fee… at a guaranteed 4%, for 27 years, and adjust the imputed amount to be the difference… what would that be? What about the investment options, after fees? Gotta run the math.
I don’t see any pilot hurt by going GVUL. The investment side becomes do you want to “be your own bank”, build a cash value to keep paying the premiums when you retire, or just save in taxes for the rest of your career. Enrolling makes complete sense, the rest needs some time with a spreadsheet and everyone’s numbers and outcome will be different.
I don’t see any pilot hurt by going GVUL. The investment side becomes do you want to “be your own bank”, build a cash value to keep paying the premiums when you retire, or just save in taxes for the rest of your career. Enrolling makes complete sense, the rest needs some time with a spreadsheet and everyone’s numbers and outcome will be different.
10-27-2023 | 11:57 AM
#102
Moderator
Joined: Sep 2011
Posts: 8,321
Likes: 1,331
I’m planning to run that illustration when I get some time. For easy math let’s say my current imputed is $1150/yr in income. Let’s make math easy and say marginal tax rate is 30%. Current plan is costing $350/yr in taxes. The GVUL imputed drops that to $350/yr and a tax bill of $105. So a $245 difference a year in my cost for the same coverage (subject to go up in each 5year age band). Now, if I put $245/yr into a 4% investment, minus a 2.25% fee… at a guaranteed 4%, for 27 years, and adjust the imputed amount to be the difference… what would that be? What about the investment options, after fees? Gotta run the math.
I don’t see any pilot hurt by going GVUL. The investment side becomes do you want to “be your own bank”, build a cash value to keep paying the premiums when you retire, or just save in taxes for the rest of your career. Enrolling makes complete sense, the rest needs some time with a spreadsheet and everyone’s numbers and outcome will be different.
I don’t see any pilot hurt by going GVUL. The investment side becomes do you want to “be your own bank”, build a cash value to keep paying the premiums when you retire, or just save in taxes for the rest of your career. Enrolling makes complete sense, the rest needs some time with a spreadsheet and everyone’s numbers and outcome will be different.
10-27-2023 | 12:24 PM
#103
Line Holder
Joined: May 2022
Posts: 476
Likes: 107
Is there the ability to opt back in to the company Term plan if the tax laws change and the imputed values switch? I'm assuming you could cash out any savings you have it in, without tax penalty up to the basis tax-free and then switch?
People keep saying they think 401k's will be gone after by congress. Assuming that could be the same for this. One signature and any tax savings up to your basis could be done away with as well. Not saying its likely, just maybe possible?
People keep saying they think 401k's will be gone after by congress. Assuming that could be the same for this. One signature and any tax savings up to your basis could be done away with as well. Not saying its likely, just maybe possible?
10-27-2023 | 12:32 PM
#104
Gets Weekends Off
Joined: Sep 2006
Posts: 2,613
Likes: 7
From: Bus driver
10-27-2023 | 01:45 PM
#106
Gets Weekends Off
Joined: Apr 2007
Posts: 5,613
Likes: 627
The investment portion is lackluster. The inclusion of insurance premiums in the investment basis provides a small tax advantage and MetLife charges a front end investment fee of 2.25% because of it. Including the cost of insurance in the investment basis is a good example of the power insurance companies wield in DC.
10-27-2023 | 02:41 PM
#107
On Reserve
Joined: Mar 2017
Posts: 70
Likes: 2
The podcasts mention portability and keeping the policy after you retire. Has anyone seen the premiums that we would have to pay after retiring (or otherwise leaving)? I can't find the tables on the informational website.
10-27-2023 | 09:19 PM
#108
Thread Starter
Gets Weekends Off
Joined: Jun 2015
Posts: 2,008
Likes: 184
10-28-2023 | 09:02 AM
#109
Gets Weekends Off
Joined: Apr 2007
Posts: 5,613
Likes: 627
Although permanent, the GVUL is most definitely NOT a whole life policy.
10-30-2023 | 09:14 PM
#110
Gets Weekends Off
Joined: Feb 2015
Posts: 319
Likes: 0
Yes. You can choose between the existing Term plan and the GVUL plan every year during open enrollment. And yes, you can cash out tax free up to the cost basis.
