© Gordon A. Schaller, 2011. Gordon Schaller is a prominent tax and estate-planning attorney in Southern California who has been in practice for over 30 years. A partner at Jeffer Mangels Butler & Mitchell LLP, Gordon focuses his practice on taxation issues, estate planning, business succession, charitable and wealth management services and trust and estate litigation. Because of his expertise, many high net worth individuals, family offices, and numerous public and private charitable organizations turn to him for effective and creative solutions. His intimate knowledge of financial, estate and tax structures make him a crucial member of an affluent client's core team of advisors. Reach him at [email protected].
Volatility Can Kill Your Client's Variable Life Policy
October 19, 2011
« Previous Article
| Next Article »
Login in order to post a comment
Comments
-
Retirement tooThe same effect happens in drawing income from assets in retirement - drawing income from a portfolio that is volatile will drag assets down faster than during an accumulation phase. Consider putting sufficient assets into non-volatile instruments to support income for say 5 years or more.
-
Volatility and Variable LifeThis is the worst product line the insurance industry has ever came out with. Agents didn't understand it, applicants didn't understand it, and the downside eventualities were rarely discussed, especially in the mid-90s to 2000. In those years, proposals were run with a gross rate of return (GRR) of 10-12%. Some were even sold as a single premium without any follow up for reallocating the separate account. Virtually no one knew about the head-for-cover fixed account. There's only one market niche for variable universal life: young professionals that have maxxed out their other tax-deferred savings opportunities, need a death benefit, and are willing to overfund the contract. Outside of that profile, it is completely unsuitable as far as I'm concerned.