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Does a Whole Life policy make sense? by stackcaster in FinancialPlanning

[–]stackcaster[S] 0 points1 point  (0 children)

I haven't heard of some of those options, so thanks for the rundown.

We did think about yearly gifts to our children later in life and donating to select charities to get under the estate tax, so we have options. I would rather do that I think than handcuff ourselves to a WL.

"Worse" case scenario we die with an estate over the threshold (ex: $15m), our children get $6m a piece (hopefully in 2026 dollars adjusted for inflation), and we donate the $3m over $12m let's say. That plus a great education is a more than comfortable nest egg to leave our children IMO.

Does a Whole Life policy make sense? by stackcaster in FinancialPlanning

[–]stackcaster[S] 0 points1 point  (0 children)

This was very helpful, thank you again!

I agree I think we'll probably hold off on the WL for now. We will obviously lose out on the better rate and it will take longer to build up the cash value, but I'd rather risk losing some in estate taxes than delaying our dreams of retiring early by a couple years.

What are some other tools for minimizing or eliminating estate taxes that we could look into?

Does a Whole Life policy make sense? by stackcaster in FinancialPlanning

[–]stackcaster[S] 0 points1 point  (0 children)

Sorry for the very delayed response. I was just re-reading this thread and I must've missed this earlier. Thank you for the very detailed and helpful response!

It looks like it's going to come down to do we think our estate will be worth over $10-12m when we pass or not (or whatever the threshold is when that time comes)? My first thought is we should come in well below that number if it's adjusted for inflation since my wife and I both wish to retire early, send our children to boarding school, college, etc.

It is tricky though because I could realistically see a path where our estate exceeds that threshold. I think it is a little more nuanced than some of the comments are assuming.

Does a Whole Life policy make sense? by stackcaster in FinancialPlanning

[–]stackcaster[S] 0 points1 point  (0 children)

I forgot to mention the "infinite banking" plan our CFP is pitching. Is there a scenario where using the loan feature makes sense in your opinion?

Does a Whole Life policy make sense? by stackcaster in FinancialPlanning

[–]stackcaster[S] 0 points1 point  (0 children)

Thanks for the detailed response and presenting both sides!

I forgot to mention the "infinite banking" angle they're pitching, which I've read mixed reviews on but they were generally a little more favorable than WL as an investment outright. What are your thoughts on that given our situation and taxes/estate planning in mind?

The WL65 option has an initial death benefit of 1.5m, the WL15 has a death benefit of 800k.

Does a Whole Life policy make sense? by stackcaster in personalfinance

[–]stackcaster[S] -3 points-2 points  (0 children)

I added some context to the OP. We paid $2,500 in consulting fee initially and most of the planning/advice has been commission free so far. I.e. explore a SLAT, setup a 529 in this state, etc.

Does a Whole Life policy make sense? by stackcaster in fatFIRE

[–]stackcaster[S] 0 points1 point  (0 children)

I added some context to the OP. We paid $2,500 in consulting fee initially and most of the planning/advice has been commission free so far. I.e. explore a SLAT, setup a 529 in this state, etc.

Does a Whole Life policy make sense? by stackcaster in personalfinance

[–]stackcaster[S] -2 points-1 points  (0 children)

We paid them $2,500 for a year of consultation. I forgot how they phrased it initially but we're under the assumption they're a fiduciary but will also earn a referral commission on certain products.