 Think Tech Hawaii, civil engagement lives here. Once again guys, this is the Prince of Investing, the Prince of Investing show coming all the way live from Haluulu, Hawaii, but of course I'm here in Democartorado. Don't forget to hit the like, subscribe, comment, and share button for everybody that catches the playback and all the people that are live. Thank you for tuning in. But as always guys, I don't have a lot of time and I definitely, you guys don't have a lot of time, so we're going to jump straight into it. So today's topic, as you can see in the description box and to the title, we're going to be talking about indexed universal life policies, right? You know, these are the strange things that some of us heard about where you can invest with getting some of the market without getting out of the downside, the whole life policy. But I have a very, very special guest on the line, called all the way from Virginia, that's going to be our expert. She's our expert, she's a Forbes contributor, she's a doctor, know around the industry, a financial guru, wealth, wealth guidance, financial advisor, wealth guru, all of the great stuff. But I know you didn't come here just to hear my voice, so let me go ahead and introduce my very, very special guest, Ms. Dr. Shirley Lu. How are you doing? How are you doing, Dr. Shirley? Thank you very much for having me, your prince. Very much appreciate it. Doing great. Thank you. Okay. So now for the people out there who don't know who you are, who are you? Well, what I do is I'm basically a broker and we do business across 50 states. I got into the financial services for a very different reason. My husband had passed away unexpectedly and left me with three kids with no life insurance. So I wanted to get into the financial and really educate women to understand what's out there, what do you have. And then of course, prince, I find out that a lot of men sometimes when I ask them, what's going on with your financial and the next answer they give me is that, oh, my wife does it all. So it's a conversation that I don't think men and women have frequently enough that's needed. Wow. So you, with three kids, your husband passed away with no life insurance? Yes, sir. Wow. How did you make it? How did you figure it out? Well, you know what, to be honest with you, it was a struggle at that time because, you know, when you're sitting there, you've got, you know, four mouths to feed, where do you go? And I was very fortunate in my life at that time, heard in the industry there were new product emerging, indexed annuity and indexed life. And to be honest with you, you know, 13 years ago, it sounded too good to be true. No one believed me, no one trusted it, never heard of it. Do you know today is one of those miracle days? I had client 10 years ago, a doctor, cardiologist came in today, he said, Ms. Lou, I'm 70 years old, you met me 10 years ago, you did my first annuity account, I gave you a total of $331,000. You told me I could never lose my money. You told me I could have guaranteed lifetime income. Can I please execute it today? Do you know, I'm proud to say, Prince, that I today I executed a lifetime income stream of $41,000 every year to the day he dies, he'll never, ever run out. And God forbid, if he ever gets sick, the money doubles. Wow. How's that? Now, that's the thing about it, great topic. And the reason we're having this talk today, because I want to get into annuity, I want to get into, it's like a hidden gem on the financial industry. You know, we all think about stocks, bonds, CDs, real estate, all the types of investment vehicles that are great for everyone that's out there, but it's the hidden gem no one ever knows about life insurance and how life insurance can play a role or be used as an investment vehicle. So we're going to talk about that, we're going to talk about the pros and the cons of it and things like that. Now, someone out there who doesn't know, indexed universal life policy, what is that? Well, indexed universal life policy is kind of like a hybrid life insurance where it gives you the best of both worlds, okay? So let's start back with the very basic fundamental first. You know, people go to work, they have term insurance. Cheap goes away and eventually you don't have it, okay? That's the term. And then they got the whole life 4% guarantee, then the universal life, it gives about 6% guarantee. And the last part is the variable universal life where you make a lot of money, but you could lose a lot of money. Well, the index is a hybrid between the two, here's what it does. The index is if you gave me $10, that $10 part of it would be paying for life insurance and the rest of it will go into somewhat like an investment. Now, under the indexed universal life is that they're not going to take your $10 and invest it in the market. They're just going to use the market, the S&P 500, as a way to measure how much credit to give you when the market does perform. So, for example, there were years where the market did really well. Well, guess what? My client, in some case, makes 17, 18, 25% gain inside of life insurance policy. However, when the market was losing money for the past couple days, the weeks that you've been seeing, it's locked down. There are no losses at all. So, what you have is you have like a staircase. When the market performed, you go up to the market and the market goes down. It's locked down and there are no losses. So, that, to me, is what an indexed universal life it does. And to be honest with you, you know, because it's important, you know, I don't, I mean, I want my money to gain. And at the same time, I'm concerned about the market loss. So, index gives you the best of both worlds without that. But guess what, bud? Here's the thing, what people don't want to stand about. You're right, Prince. It is absolutely gem of the industry because inside of life insurance, the money is growing tax-deferred. If you structure this thing properly, the entire things, all the gains tax-deferred as well. And then you've got compounded interest on top of it. And then when you take it out, you structure it as a loan feature with no taxes for your retirement. How's that? Okay. That sounds pretty good, right? Now, I had a question for you, right? Yeah. Now, you said that you, is there a cap on your upside? Because you said that, hey, you get all the market gains, but you get none of the market losses. Is there a cap to the upside? Well, under indexed universal life, a lot of agents, the brokerage firm out there will be selling you index IUL. But the one that I have, that I represent, some of my carrier, has no cap. Okay, Prince, a lot of financial advisors are gonna be sitting there, the mouse is probably dropping right now, okay? They're like, no, what do you mean, no cap? I can tell you that, okay? Because you know how I go into a room and I say that, they look to me like, oh, what planet are you from? You know, planet Earth, you know? Well, the reason I have several companies that have proprietary product that's specially designed for us, for our clientele, that is no cap. What I mean to say that is, I'm talking about no cap on the game, okay? But whatever the S&P 500 does, you can make that. Now, it depends on the carrier and the company. There may be a fee involved with that, okay? So for example, Prince, let's say one company said, you know what, if the market makes, I don't care how much it makes, you know, let's say they make 25%, I may take a 4% fee. They'll credit you 21%. Follow me, okay? One company may say, you know, yeah, you know, so they range just, you know, 4% or 4.75, but here's the beautiful part. There's no, I mean, that the floor is zero. However, that's also another scenario where if the client may say, I don't want the 4% fee, fine. Then we'll put you into an index product where you can have a cap, could be a 12.5 or 15% or whatever it may be, but there's no fees on that, but the maximum you can earn on those is a 15%. You understand what I'm saying? Or 12%. Because as an independent broker, I can represent many company and find what's the right best solution. You know, so that's what it is. But there's another unique thing to this and I'm about to shock you right now. Prince, imagine this, are you ready? You're business owner. You're a business owner, and typically a business owner have what is called your retirement plan. They may create what's called 401K, IRA, whatever. It's a very old traditional stuff, right? What if I came to United States, Prince? What have you used an account where we're using the bank's money to front load into your retirement account? Using the bank's to front load into your retirement account? Have you heard of that? So you're using the bank's money to front load into your retirement account. What is that called? It's guess what? An index, universal life, policy life. What if I can tell you, let's say you're a business owner and I'll give you a really great example. Let's say today, you know, typically you may go and put in an IRA, $25,000. Well, imagine if you put in $25,000, my bank match you $25,000. You put in another $25K, my bank match you another $25,000. We do it for five consecutive years, you're done, but you no longer have to put anything in there, Prince. Year six through 10, 25 to 25 is $50,000, right? My bank will fund the entire $50,000 for the next five years after that. You're talking about index IUL on steroids. Do you understand what I'm saying here? You're having front-loaded money into the account that you can put it on steroids where now it's growing tax-deferred and it's in an S&P 500, right? Well, now you can have a market gain and if the market goes down, you still don't lose anything. The only catch is very simple. The money that I gave you from the bank, they're gonna charge you your interest rate, very low interest rate, LIBOR rate, right? LIBOR is very low, you know that, right? How much is this interest rate gonna be? Well, LIBOR, typically LIBOR plus bank fees, LIBOR has been running some time, 3%, 2%, 4%, you know, 5%. So think about this, you're loaning out the money, right? Let's say a 4% or 5%, right? But at the same time, you've got this other money, your money plus the bank's money on top of it, putting it into an index product where it can participate S&P 500. And we did a hypothetical illustration roughly around 7% long-term. Here's the beautiful part about this account. Inside this life insurance, you know, utilizing this unique feature down the road, the bank, of course, would go in after 15 years, get their money out of what they loan you, right? So they reach inside your life insurance and take that portion out, leave the rest money for you and imagine this, at age 65, the account distributed tax free income versus loan feature is pretty neat, via loan feature. Let's say, gosh, I did one the other day for 32 years old, putting in $20,000 a year and at retirement, she's gonna get like $150,000 tax-free retirement every single year for the rest of her life. $150,000 tax-free. Now, what if someone came in and got an annual index universal life? And let's say they were 30, but they went to retire at 45. Well, could that be done for them? Or do we have to wait to 65? You don't have to wait to 65. It's, retirement is all about how much you put in and how much you can make during the time that you have. Remember, I told you that program on steroids, are you on steroids? We're using the banks program. I'm telling you, if you structured properly, right, whether you're 40 years old and let's say 15 years from now, which is you're 55 and you said, hey, I want a stream of income, what a great way to front load, right, using other people's money. And then after 15 years, we pay the bank the loan money off and then we turn right around, guess what, distribute a tax-free income from that life insurance. And not only that, you're ready for this, but the IUL, the next IUL is not only life insurance, guess what it has nowadays? It has chronic illness, critical illness, critical injury. It has terminal, it has accelerated. Every single benefit that I have gave you at no charge included as well. So now you've got a $1.5 million life insurance. If you get critical injury, you can accelerate a part of it, right, to use while you're alive and not dead. Because, you know, I see a lot of time people get sick way before they're dead. Prince. And if you think that's gonna happen to you, index IUL is the perfect way to do it. And I love, I have- And I have a question. Yeah. That's what I got a question for you. Yeah. What are the downsides to this? What's the disadvantages? You ready? Here's, I would call it the disadvantages, but the event, it's a long-term thing, right? Number one, when you're thinking about this, okay, I wanna save this for retirement through income down the road. You have to do it for a long term. It's not something you get in a year, two year, four, four, five years to get out of, okay? It is a 10-year better plan, right? That's the first thing. The second thing is that the, what I get objection is that I hate life insurance, right? But guys, let me tell you, people don't realize life insurance is one of the most best creation of wealth where you leave a legacy for your family and guess what I find out? Majority of the American of the US of A do not leave any legacy for their family most of the time. Most of the time, even in the minority community, think about it, when they pass away, what happens? They pass a hat around. Or today, they go go fund me, right? I work. We should change it. You and I have the power to let our kids become millionaires overnight. Rich people know how to leave generation, generation of wealth by utilizing life insurance and the rest of us don't, honestly. We don't. Why? You know, don't you rather have your kids, you know, other kids' ball, your kids' money instead of vice versa? See, I believe if you and, yeah, I mean, I see it all the time. So for one thing is that life insurance leave a legacy, a generation of it, okay? Okay, now another thing, objection always, oh, I hate to pay life insurance. Well, I just told you it's one of the greatest shelter being able to, you know, have an account growing tax deferred becomes tax advantage tax-free. The other thing's okay, so what? I paid, let's say 25% fee, right? For a life insurance, but it does give my family tax-free death benefit. I think that's important. Do I rather pay Uncle Sam the money or I rather pay 25% of that inside of life insurance policy to leave something for my family? I think I'd rather have for my family instead of Uncle Sam, you know? Yeah. I'm looking for you, right? So for people out there that are not following what we're saying, just tune it on. So in this universal life policy, it's technically insurance policy that you pay just like regular life insurance, but some of the money goes to your premium, your life insurance. The rest of the money goes into a separate account that tracks the S&P 500 that gives some of the S&P, all of the S&P 500 ups, none of the downs. Now that money that's over there, can I borrow against that money? Absolutely. That's the other beautiful part. If the cash value into the account, you know that you have it and cash surrender and all that stuff, it's beautiful. You can always take up to, believe it or not, up to 90% of your money, because why? You want to still keep the other 10% active so that the account doesn't go into a taxable event. And so, okay, if I need money, I borrow against it. And by the way, how about this? What if you borrow it and you don't have to pay it back? How's that? You don't have to pay the money back. No. And some people say, whoa, whoa, whoa, what do you mean you don't have to pay it back? Okay? You don't have to pay it back. I got a question. Another question too, before I jump into that. What do you have to say to the person that says, hey, instead of paying all this money in a whole life policy, why do not you get me a cheap turn policy, just invest the rest of the S&P 500? What do you have to say to that? Well, I'll give you an example. You've heard of, I hate to say this name, but let's start with the letter P, okay? The letter P company promote that, by terms of that's the difference, right? So, I wish, Prime America. Oh, okay, okay, okay. Okay, so what happens is that I said, you know what, I wish I can bring some of those agents sit across all my clients that are 50, 60, try one of them, 71 years old today, radio show host on Sears XM, to find out that his term has ended and now it's gonna cost him, you would not believe, almost $20,000 a year for a term policy of same coverage. How do you explain that, okay? Because all the terms running out- Because the term eventually runs out, they'll run out, okay? It runs out and they can't qualify, they're too old and all this stuff and it just costs prohibit it, right? So, that's buying term, okay? Because you're betting against the insurance company, you can die a certain period of time. I don't know when I'm gonna die, and if you look at the statistic, how much term pays out, are you kidding me? I wish they could sit in front of my clients today, Prince, the one heartbreak that he's got diagnosed with cancer. You know what I mean? Things like that. He said, surely unless I die within the next six months, my family will not get anything. Did you know there was a congressman? I gotta get you the article. There was a gentleman who had committed suicide because he had to do it because his term was getting ready right now and he was sick and he wanted his wife to collect money. Yeah, so, invest the difference. I'm sorry, I forgot to answer that, but invest the difference, okay? So, invest the difference. Great if the market goes up, what happened to market goes down? Do you know three days ago, I had an opportunity, sat across the vice president, vice president level of a very big bank, Capital One, okay? He has a group of investment folks that he runs operation, all that, right? So, he saw my program that I told you about the index using life insurance and I did a hypothetical return of 7%, right? Do you know what he said to me, Prince? He goes, Miss Lou, you're running it at such a high interest rate right there, aren't you? And I looked at him dead in the eyes and I said, excuse me, sir, I'm using the S&P 500. And he said, well, you know what the S&P 500 has been for the past 20 years. It's only 5. something percent return. Did you know that, Prince? Did you know that all the 401K, the IRA out there, it's been only 5. something and all these financial advice, a lot of folks too. No, it's awesome, it's awesome. But guys, it's only been awesome the last five years. You know what, I say things that people don't like to hear it, but you know what, I admire this executive that he sat there and I told him, I said, do you know you're the first executive admitted to me that because most of the time, fight against me that. And then I went back to say, I said, oh, by the way, you told me that my 7% is kind of high. Aren't your entire team is recommending folks to put in stock and mutual fund and other stuff? Isn't that, that you believe in the market's gonna do well? You and I are linked to the same market. I believe in the long term, the market could make money. So what's not to like? Yeah, it's cool. The question is, so you say historically, IU Wells, followed the S&P 500, taking some of the ups and none of the downs, returns about 7%. Yes, more than that, more than seven, yes. So seven is like the floor. Well, what we did, we went back 20 years. In the index product depends on the fund that you have. And every fund that I had, it has averages more than 7%, that's correct, more than seven. And the S&P only did 5.76 or something like that, yeah. And then also if I had a custodian account, if I started my own custodian account or whatnot, so, and I did it for my children, and I did this for my children, I had a custodian account, I had to pay taxes on their money on that long-term capital gains. Now with the IU Wells, did you recommend those for children? Oh, do you know what? I just did one the other day where I front-loaded into the child's children's account so that when it's 18 years old, just parents, they just have the baby, they front-load into this thing, and that way, they can take it out as a loan feature with no taxes. That's a unique way, every client is different, of course. You know what I mean? It depends, some client tells me, oh, surely I want to get 20,000 a year, I want 50,000, 100,000 for paying college education. And then, of course, some of them said, oh, surely Ellen can do 50 bucks a month. So again, it depends on what kind of money we're talking about here. How much parents can put in? Exactly, how much parents can put in, because this is a decision we need to make, okay, do we put it into using the parents' account as a shelter, or do we use it as the child? You know what I mean? So in that case, everybody is different, how this thing is designed, but I love it, I think it's a new dynamic way of doing saving and investment, retirement. Gosh, there'll be another session, and hopefully you and I can talk about so much more than what an ideal can do, you know? Yeah. Okay, so for people out there that listen, that are zooming in across the globe, and they're like, wow, this sounds like a pretty awesome idea. They want to get more information from you. How do we get in contact with you? Well, you know, they can Google me, it's really easy. Oh, do you just want to tell them? Surely. Are you going to tell their contact friends, okay? Yeah, surely, F-H-I-R-L-E-Y, yeah, and Lou, L-U-U, but you can surelyloufinance.com, surelyloufinance.com, and one of the things that's coming, upcoming 2018, 2019, you're going to be seeing a lot more exposure of things that I'm going to be involved with, you know? I know that I've just recently signed some agreement with some of the ESPN show that I'm going to be on, a lot of radio show. I am on a lot of cable show, TV shows now. Been fortunate enough, you know, like I said, exposure in the full of the October 2016 issue. And actually, summer of this year, June, there are going to be several articles coming out. One of them is in the Oprah Magazine, you've made it, and another entrepreneur magazine as well, and of course, I've got tons of other fake-nope podcasts and things like that that I'm scheduled to talk, just getting on and getting all of these different products out there to people that they don't know. There are no costs to contact me at all. It's a free, you know, I've got a team of associates across 50 states, everywhere I go to. Texas, like you said, I'm flying to California, I'm going to Vegas, I do a ton of speak-engagement events and what's nice is that corporation and company and attorney now are all reaching out to me and joining partnership and getting this financial education out there through folks, you know. And my direct line, my direct sell contact is 703-608-1203, and yeah, absolutely. Definitely, all the contact information website and stuff will be in the description box so you guys can see, and if you want to reach out to me, Sherry Lou. So Sherry Lou, to anybody, I think that's Dr. Sherry, anybody that's out there, is there anything that you want to say before we get out of here? Yeah, you know what? I know, you know, we'll give you a free analysis, take a look at where you are. At the same time, we're growing tremendously as well too and as a matter of fact, right now I'm doing a bunch of hiring as well too, Prince. So if anyone wanna gain in the financial industry, I'm always looking for good people as I'm spreading my wings really big, fast right now and I'd love to partner up with some of the good people out there, you know. And thank you so much, Prince. I can't wait to meet you one day as well. I don't know about it to me, trust me. I don't know about it to me. You know, my sister live in Denver. My sister live in Denver. Oh, wow, wow. Are you a Denver? Yes, I'm in Denver right now. Shoot, you know, even though we're shooting in Hawaii. So, but anyway guys, we gotta wrap the show up. Thank you guys for tuning in. As always, I'm your host, the Prince of Investor, Prince Dice, coming to you guys, Laugh and Howl the White, until the next video podcast or whatever you see me do crazy around the globe. Peace, be safe, I'm out and thank you.