Transcription
Some people are peddling whole life insurance like it's a good investment for everybody. But you know better because you follow me, Vivian, your rich BFF, your favorite Wall Street girly who can break it down.
There are two main types of insurance. Term life, you're probably familiar with. You pay money so when you die, your family gets a little something.
Whole life also has this death benefit, but also has an investment component that allows its value to grow over time. And a lot of scammers on social media are selling whole life insurance, IULs, MPIs, whatever they want to call them, as a good investment for everyone.
But in reality, these are only good investments for high net worth folks because the upfront fees are so high. In fact, MetLife determined that a 30-year-old male could pay $672 a year for 20 years of term life insurance and $8,320 a year for whole life insurance.
For the average person, the upfront cost of whole life insurance would be better invested in the stock market. You'd see meaningfully higher returns. And for all the times that whole life was touted as this amazing investment, they miss one big caveat: it only makes sense if you already have a lot of money.