Originally Posted by demon llama (Post 3712569)

Notes from the Webinar tonight:

1) The GVUL is applicable to the Delta paid insurance (2,500 times the 12-year captain rate) not the supplemental term available from Delta.
2) If you choose GVUL the first $50,000 remains term and the rest transitions to GVUL
3) Enrollment period 1 Nov - 17 Nov
3a) Complete enrollment 27 Nov - 20 Dec
4) GVUL is permanent and portable
5) Variable range of investment options (low to high risk tolerance)
Or
6) Interest bearing account (guaranteed fund account) current minimum rate of return 4%. Will never go below 1.5%. Can only move 25% of funds out of this account into the variable funds.
7) Tax free transfers between accounts
8) Expense charges: 2.25% expense charge for additional funds added above what Delta pays
9) Tax advantages: All earnings are tax deferred. Access to cash value when needed without penalty. Tax free withdrawals up to basis.
10) All investment dollars are on an after tax basis (either lump sum or partial deposits)
11) Tax free withdrawals up to basis: Delta paid premiums + own invested inputs (additional GVUL premiums paid as investment)

Example:
Age at issue: 40
Ends at age 65
Premiums Delta pays: $39,282
Extra premiums paid for savings/investment: $125,568 (optional)
GVUL earnings: $93,235

Paid in total (basis): $164,850
Cash value subject to tax $53,953
Available cash value $218,803

12) There is a maximum amount that can be invested per year (changes year to year)
13) This is not a whole life policy
14) Taxes are more favorable on the GVUL policy
15) No rider options
16) No further underwriting required at retirement if the policy values are not increased
17) Basic imputed income is lower than with group term
18) If you don't use the investment option, nothing is returned to you if you surrender the policy upon leaving Delta. (Cash value would be returned and the amount over the Cost basis is taxed at your current income tax rate)
19) You could revert to Group Term during subsequent open enrollment seasons.

www.metlife.com/gvul/DeltaAirLines

The presenter handled a lot of Q&A. You can register for future webinars on the website.

I'm just a guy, but it seems to me that there are no drawbacks to the GVUL vis a vis the Group Term if you don't leverage the investment option--i.e., you get the same death benefit. If you're looking for another vehicle to diversify your portfolio you'll have access to investment accounts with GVUL. You could also just keep using your own money to pay into your usual investments (bitcoin, gold bars, whatever).

Originally Posted by PilotFrog (Post 3712571)

The bolded in and in Red is what caught me by surprise in the presentation. Seems quite a hit.

Originally Posted by Vsop (Post 3712574)

That’s a per transaction fee, but I agree waaaaay more than I want to spend

Originally Posted by demon llama (Post 3712578)

If that type of fee roughly translates to expense ratio of other investment funds, I agree, you can get a better rate at Vanguard.

I'll switch to GVUL based on the lower rates of imputed income. I may or may not throw some money in there to keep up with the cost basis. That part is completely voluntary.

Originally Posted by First Break (Post 3712570)

Option A: Status quo death benefit, high imputed income

Option B: Status quo death benefit, low imputed income, other ancillary benefits that are completely optional and voluntary


APC: “Sounds like a screw job! They obviously aren’t telling us everything! I bet the mean lady in Raleigh was behind this!”


Seriously, based on everything that’s been communicated and a general understanding of the two options, I can’t understand any rationale for continuing to pay excessive imputed income. We have the option to pivot to a much cheaper plan, with exactly the same death benefit. End of story. But please, stick it to the mean lady if that floats your boat.

Originally Posted by Verdell (Post 3712584)

It's not a bad thing to seek the devil's advocate on the new policy. i.e. "What's the catch?"

It's seeming to me that the catch is a potentially better apples to apples policy, with the addition of potentially poor, but optional, additional investment products. Insurance is in the money-making business afterall, and it's rare that they would offer 2 very similar options, dangle a carrot in front of the second one (less imputed income), without some angle to it. I think the angle is that they expect to make more money on the additional investment side for those who choose to participate. Might be a small % on a small % of total participants, but insurance plays the % game.

Originally Posted by Trip7 (Post 3712597)

I've never paid attention to the imputed income tax. Roughly how much in tax savings does the GVUL provide?

Originally Posted by demon llama (Post 3712569)

Notes from the Webinar tonight:

1) The GVUL is applicable to the Delta paid insurance (2,500 times the 12-year captain rate) not the supplemental term available from Delta.
2) If you choose GVUL the first $50,000 remains term and the rest transitions to GVUL
3) Enrollment period 1 Nov - 17 Nov
3a) Complete enrollment 27 Nov - 20 Dec
4) GVUL is permanent and portable
5) Variable range of investment options (low to high risk tolerance)
Or
6) Interest bearing account (guaranteed fund account) current minimum rate of return 4%. Will never go below 1.5%. Can only move 25% of funds out of this account into the variable funds.
7) Tax free transfers between accounts
8) Expense charges: 2.25% expense charge for additional funds added above what Delta pays
9) Tax advantages: All earnings are tax deferred. Access to cash value when needed without penalty. Tax free withdrawals up to basis.
10) All investment dollars are on an after tax basis (either lump sum or partial deposits)
11) Tax free withdrawals up to basis: Delta paid premiums + own invested inputs (additional GVUL premiums paid as investment)

Example:
Age at issue: 40
Ends at age 65
Premiums Delta pays: $39,282
Extra premiums paid for savings/investment: $125,568 (optional)
GVUL earnings: $93,235

Paid in total (basis): $164,850
Cash value subject to tax $53,953
Available cash value $218,803

12) There is a maximum amount that can be invested per year (changes year to year)
13) This is not a whole life policy
14) Taxes are more favorable on the GVUL policy
15) No rider options
16) No further underwriting required at retirement if the policy values are not increased
17) Basic imputed income is lower than with group term
18) If you don't use the investment option, nothing is returned to you if you surrender the policy upon leaving Delta. (Cash value would be returned and the amount over the Cost basis is taxed at your current income tax rate)
19) You could revert to Group Term during subsequent open enrollment seasons.

www.metlife.com/gvul/DeltaAirLines

The presenter handled a lot of Q&A. You can register for future webinars on the website.

I'm just a guy, but it seems to me that there are no drawbacks to the GVUL vis a vis the Group Term if you don't leverage the investment option--i.e., you get the same death benefit. If you're looking for another vehicle to diversify your portfolio you'll have access to investment accounts with GVUL. You could also just keep using your own money to pay into your usual investments (bitcoin, gold bars, whatever).