does age matter we get this question quite a bit or we hear hey am I too old for policy and
I wish I would have done this so long ago when I was twenty or thirty but I wasn't showing to
me in the same manner or I just didn't like it or I didn't have the money at the time so to the
question does age matter well you see two things on the board here why don't you see price quoting
and then you see cash value planning here's the thing if we are price quoting meaning I'm
buying a life insurance policy at the age of 30 or at the age of 60 well then yes it matters if
I am focused on a death benefit the older I get the closer I get to death to mortality the more
expensive that life insurance policy will become however when it comes to cash value planning no
then I put in there not as much the reason why is as I grow older you will see internally the
insurance expenses are a bit higher but without getting too deep into the weeds when we set up a
policy if you've watched any of our content on policy design if I'm 30 years old or if I'm 65
years old could be older younger but regardless of age if I'm going to put $1.00 into a policy
just to illustrate for simplicity where can that dollar go at the end of the day it can go toward
my insurance premium or can go toward my PUA Rider think of it this way initial insurance
expense cash dumping if I put the same percentage let's say I put 10% into the premium and 90% into
the PUA and I'm 20 years old 30 years old 40 50 60 70 whatever age if the ratios are the same
what you will find is that the cash values will be very similar so putting in the exact same cash
flow same cash values are very soon cash values but the older I am that dollar will get me less
death benefit so no that could be a little bit confusing let's demonstrate so what we've got
here is just a quick spreadsheet simple math short funding period 50,000 going in for five years we
can fund it shorter or longer but what we're going to focus on here is same cash flow going in same
policy design meaning of that 50,000 we've got the minimum insurance premium maximum PUA or cash
value allocation just you'll see oddball death benefits and the reason why is the death benefit
has a direct relationship to that MEC that MEC that's a taxable line on the policy to simplify
it we minimize the insurance expense to maximize the cash value what's interesting about this is we
pay in 50k the first year the ratio two are the same what difference do you notice in cash how
about with the 30 and the 45 year old male about 50 bucks for the 65 year old male it's a little
bit less instead of 43 9 we're at 42 3 a little bit less in cash value the internal expenses are
a bit higher here with the term rider inside but still with that said we have highlighted in yellow
our break-even point our break-even point for these examples on each of the policies is when
your forum I've paid in 200,000 I have 200,000 or more the 65 year old has 199 and change so
we just trended for simplicity point being we're breaking even at the same period of time because
we're older it's not drastically delaying that break-even period we've heard I've heard from
individuals over the years of working with them that they've been exposed or presented whole life
insurance in the past at the age of 30 and they didn't move forward because it took them 12 years
to break even or get their money back they said listen I can do better things with my money in
the meantime and I get it I'd do the same thing then we see someone much older 65 and we've done
this with people who are 75 crossing over between 4 & 5 years 4 & 5 now as time goes on you will
find the younger we start the better if I look at the year 50 mark for each of the policies the guy
that started at age 30 has 438,000 age 45 for 34 not a big difference there and then age 65 when
I started so 15 years down the road I'm just about 80 about 388 so a little bit of a difference there
and that's because I'm getting near mortality I mean the insurance companies mortality tables
expect me to die you're on that neighborhood at 85 to 90 I started to see my intentionally growth
typically slowed down as a result their point being still a very attractive cash value policy
for someone in their 60s that might normally think had too old I can't get involved because
I should have started 20 years ago however I mean with that said if we fund the policy properly age
does not matter quite as much we can reap the same benefits and in the early years when I'm
gonna be using the money if I'm starting at 65 that was really better I have very comparable
cash value so make question or beginning question does age matter kind of as time passes but my
personal opinion is not really as long as the policy is designed correctly hope this helps
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