I have a pet peeve and that is misinformation. I have been hearing a lot about Variable Unit Linked o Variable Life Insurance and many financial advisers are selling it like this, “Kuha ka sakin ng investment.” that really alarms me on so many degrees but in this piece, I will only give you one strong reason.
VUL is a protection tool, hindi sya strong tool for investment so never get VUL for the sole intent of investing.
I understand that many financial advisers will insist that I am wrong, that kumikita naman but they will not tell you that there are better forms of investment na di kasing mahal ng VUL.
Do not get me wrong, VUL is a wonderful product if used correctly. So allow me to show you ways on how you can use VUL in the best way.
Let us go straight to the point.
When we start working, we should start paying ourselves back by creating an emergency fund and retirement fund, and also, this is the best time to get a VUL.
Why? Kasi, the younger you are, mas mura ang policy at mas maagang kikita yung investment portion ng VUL mo.It means, the longer it is running, the bigger chance it can outgrow yung binayad mo sa policy mo.
That money can be added to your retirement fund. Plus, you have protection coming from the VUL too, so if something were to happen to you, alam mong you are protected and may pang pondo ka sa emergency mo.
Madaming FA na nagsasabi, kumuha ka ng VUL para in 5 years, may pang bili ka na ng car. Kapag naririnig ko to, naaawa ako doon sa mga naniniwala. Why? Kapag winithdraw mo lahat ng laman ng policy mo, magcclose ang policy mo, wala ka ng protection. Sa madaling salita, sinisweet talk ka lang ng financial adviser mo at please lang, if you are reading this, WAG KANG MAGPAPAUTO.
Pero going back, how can you use your VUL for your medium to long term goals? Well, kung malaki ang kita ng VUL mo, pwede mo don kunin yung fund ng pambili mo ng dream car, dream house, etc., pero kung tama lang, pwede na syang pandagdag. My point is, while you are saving up and working hard for it, kapag may VUL ka, not only that you have protection in case of emergencies, you will also have additional means for you to fund for your future needs, provided, may ititira kang fund kasi kung wala, magcclose yung policy.
I strongly recommend all parents to be insured. Imagine if wala kang insurance then you die biglaan? Worst, you get sick. When you get sick and die, not only your family will spend a huge amount of money for the funeral, they will also spend millions if not hundred thousand or a few more, just to help you survive. Di to okay, pero mas di okay kung di ka insured, kasi kawawa yung family mo at kawawa ka din, worst, if you do not have savings and money to begin with, how will they fund your emergency needs and their daily needs? Pano yung future ng anak mo?
Another thing is that since VUL has an investment linked to it, that you can use for the college fund of your child. Kung sakaling walang mangyari sayo, this way, di ka lugi sa binayad mo kasi you earned it back and better, you are able to use it to fund the education needs of your child.
Basically, VUL is a tool, its main purpose is to protect you, not to have an investment and it can only be effective if you have a specific plan why you will get one.
I understand that not everyone knows how to go about financial planning, that is why I strongly recommend to all financial advisers to conduct financial needs analysis bago sila magbenta ng policy.
Wag na po tayo tumulad sa iba na bato ng bato ng policy eh di naman match sa needs ng client nila and to all clients, you need to find a financial adivser who will do that for you. Wag kang mapressure kesyo boss mo yung nagpipilit sayo na bumili ng policy.
Kapag pinaginitan ka eh sumbong mo sa HR.
This is a long term commitment. You need to have every detail of it and as The Prudent Millennial, you can always come to me for help.
You can send me a message on my Facebook page or my personal account, Miles Benagua. Thank you for reading and I hope I was able to help.
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