Overall, it was a pretty informative article that brought up some good points, but I think one of the comments hit the nail on the head:
Before I spend time dissecting the article, are you opposed to examine the other side of this conversation?
To keep my email brief today, let me address one glaring misconception in the article. It states that agents often recommend permanent insurance b/c it pays them larger commissions. This couldn’t be further from the truth. In fact if you examine the commission generated from investing 10k annually over 30 years earning 8% in a mutual with a 1% annual management fee versus a whole life policy (using my actual commission schedule with Ohio National), the investment agent earns 227k over the 30 years versus the insurance agent earning just under 13k during the 30 years – or 96% less money.
I was brought up to buy term and invest the difference and can prove without a shadow a doubt that often it is not a better strategy. My father that taught me this theory now owns whole life as well as traditional investments. It’s interesting to me that almost all financial articles discuss the accumulation of assets but almost never discusses the distribution of assets. Without addressing the spendable income in retirement and all the other factors that build wealth any analysis is crude and incomplete at best. We increased my father’s retirement income by 30% once he understood how the cash value and death benefit of a whole life policy allows him to not spend the interest only from his investments but the interest plus the entire principal of his assets. This part of the conversation can go many levels deep.
Let’s also put to rest the idea that because someone gets paid for something that they put their own interests before a clients. It is possible to do the “right thing” for others and make a living as well. In fact, when you do, you often you make less per client but much more overall through word of mouth advertising."