I was in a meeting yesterday with a new prospect and she asked me “Are you a whole life insurance person”? As many of you know, I do like whole life to solve various financial problems but the question struck me as interesting. Whole life is just a product. It is a financial tool with different benefits. Whole life is no different than a stock, bond, real estate, mutual fund etc. All of these products are tools with different financial benefits. When executing a proper financial plan, financial products are used to implement a strategy. The strategy comes first, than the products...
Unfortunately, people are so focused on the product that they miss the strategy/skill. how all the products work together to obtain the goal. Investing more money in the market is a strategy but to what end? So now you have $2 million dollars in your 401k, invested in the stock market, and your 65:
How do you get the money out?
How much money can you take out and not fear running out of money?
How much do you need to take out to pay your bills?
What are your taxes; how much of your money to you get to keep?
Now we are beginning to talk strategy. If I can maximize your income in retirement, give you more money with benefits, and reduce your tax, do you care what products we use to implement the strategy?
Strategy/skill is far more important than the products. Just ask a professional golfer if their success is due to the type of golf clubs he/she plays with or is it their strategy/skill? The answer is very clear and it’s no different in your financial life!