The premise of the IUL challenge is like show me a policy that's 10 years old. I want the original illustration, the enforced illustration. And I just want, you know, given that the product is sold with the upside potential and downside protection, show me a policy that's even done what it said it was going to do initially. Yeah, it hasn't been able to do it. Chris Nogelopfer to match, we got $10,000 on the line. Nobody's willing to even show me one. You don't know any IUL contracts that have performed as they were supposed to for income. I can, I know thousands I can show you. When does IUL outperform whole life in a cash value? By the time the contract is... We're finally getting heated for you. By the time the contract goes into where there's going to be loans, we've controlled those costs. But, so would you agree with that? I can't do it a whole life contract, a whole life company can do the same thing. If we're in an environment, if we're in an environment where that's a risk, there is a 100 percent, the whole life company doesn't have to pay the dividend. But that's not what I'm talking about. That's not the risk. You said that. No, no, no. The difference with whole life is this is very flat and it's very measurable. With IUL, if a flat, a zero percent year adds 5 percent chart... I think the account is not a zero. Yeah, but you're not going fit. You don't get to choose fixed after the year market does zero for the year. So you don't get to swap it. So it's active. Would you agree then that your level of management and the complexity of your management goes infinitely through the roof when it gets to retirement? It's not that complex. Actually, it's one phone call and five minutes to set it. It's done. That's far less risky. But $1 million loan is out. It's a very small amount at risk where that cost is going to be a whole life. It's a much higher cost. Yeah, but that's not fair because the... No, it's absolutely not. Mortality is mortality. What's the way you make money? So if there's a mortality cost for the pump, no, hold on. No, no, no, no, no. Let me finish my thought. That's the risk. But that cost is whatever that cost is for that company. Right. Based on the annual renewable term schedule of their age. Right. And it's the same for whole life. No. Sure it is. No. It has to be, or the insurance company's going to go to the building. It's no. No. If the insurance company didn't price the whole life contract accordingly, they'd go bankrupt. They too, but they charge more up front. That is the point. Whether to become okay to speculate with life insurance. I would agree a lot of the I.O. contracts are going to blow up because of the way the engine design is. In a vacuum, I get I.O. can't work. But if the plane's going to crash, 95% of the time, do I want to get on that plane? Which is very problematic. Like, if we can all agree on this, we all agree on that. Sure. And the contracts blow up that hurts everybody because people say permanent life insurance, but it doesn't sound too permanent. If 95% of the contracts are pulling up. It hurts all of us. We've sold a couple I.O.s and we're selling some I.O.s now, but they're not. I know. I was like, what? We're just going to get right into it. Terry, we've been friends for a while. We've had a background with money tracks. I am very grateful for how you think and view the world. And so you can speak to that slightly if you'd like, but I know the three things that you shared were rising costs, not guaranteed and cap rates. Those are like three examples of why people wouldn't want to do I.O.L. but you had your spin on that. And so you can give a little bit of your backstory. But then what I want to be able to do is break down each one of those points. And then before you jump in, I just want to introduce my good friend, Chris. I'm going to be back with you for Patrick. I don't necessarily know if you need an introduction to the YouTube world. Lot of people are, you know, know you as the guy that, that's, it's a hammer on I.O.L. Hammer's on I.O.L. It doesn't, doesn't back down. You're going to pick a fight and make sure you come, come with the machine gun. So all that to say, it's good to have you here and let the, let the conversation begin. So Terry, why don't you give a quick backstory? But then let's really dive into the conversation. I.O.L. versus whole life. And I'm hoping that the our time together can create light clarity. And we'll see them. There might even be some knockout punches. We'll see. Thank you, Caleb. So, so my story begins, I guess 20 years ago, roughly, working with money tracks and learning about life insurance. And we used to have a saying that you will meant you lose and VUL meant very likely you will lose. And I could be on stage helping Chris debate I.O.L. Because if any agent wanted to sell I.O.L. I would pretty much bash you. And I'm a whole life only guy. Believe in whole life still do. Own it on my family, myself. And it is to me the best asset anybody could have. So fast forward, a mutual company that we work with kind of imploded. And that was our primary carrier. And for about a year, I didn't sell any insurance. I was ready to leave the business because I was a major violation of trust for me. And they made me rethink everything. When I came out of the trauma that I came up and said this can never happen again. So I looked on the hood very deeply, flew up to corporate offices, met with the executive teams of these insurance companies. Because to me, it's not just the numbers. It's the culture and the vision of where this company wants to go to tell you if they're going to be here in 100 years. And what I realized was there is no perfect thing any company could go through this. So we settled on the one of the big four as a mutual whole life company to use. And as I was traveling the country, a couple of guys recommended the IULs. Just really look at it. And remember in the days when I used to travel with Don, there were a couple of guys that I believe were really strategic to try to convince me of IUL. And they didn't sell the main win or remember those conversations. So here's the problem. IUL sold because of return and performance. And life insurance is a putter. It's not a driver. I don't look at it as a performance vehicle. It has to protect the money and do what it's supposed to do. So that's why when you think about IUL has increasing cost of insurance, that is technically true. So this whole life is just making the cake, something I've learned. Number two is it cannot be guaranteed paid up. These were the arguments. Why would you ever put a client's legacy on line work could explode later on in life because of that increase in cost of insurance? It's not guaranteed. And then number three, just the pure, I would say dishonesty and immoral behavior of the many, not all of the IUL carriers, the promoters, the IMOs. And everyone's regurgitating the same crap, which is what I was really going to fighting against, which Chris is great at fighting against. But I finally went up to one last meeting up in Virginia. Another guy I've known for 20 years, trust the guy, friends with the guy. And I said, OK, this is the last shot. Why should I use IUL? And he cut through all the crap. He didn't talk about how, oh, it'll blow away whole life. He knew my conviction of whole life. He knew I didn't care about performance. As a side note, we run all of our IUL illustrations at 5%. We don't use what we're allowed. We meant when we saw the whole life, we did the same thing. We don't have to oversell life insurance. It's an incredible asset without the performance. OK, performance is important, but that's not why people should buy it. And when you say performance, you're saying the cash grow. Yeah. Yeah, obviously, it's a parking place for your money. Life insurance is a place to park your money. You don't really make any money in your garage. You take your car out of the garage and go do deals. Life insurance protects your money so you can use it. So you don't want to add risk. So what this gentleman mentioned, I don't know if I can say the name, so I'm just keeping things. Your podcast, I'm just here as a servant, is he knew the issues for me was cost of insurance. And what he explained to me was really interesting. We'll start with this one. Is that every insurance carrier sells their risk as one pull, term, IUL, whole life. It's all the same. It all gets sold at the end of the year to re-insurance, where they priced it accordingly each year, based on mortality. So the one thing that I understood this is how whole life works, is that, and for those that don't know, all life insurance contracts have levers in them. And a lever, one lever is the cap rate with IUL, with whole life, it's the dividend. It's also cost of insurance, and there's other things, because there's more cost and just mortality cost, but we'll keep it simple here. We'll just, if I say mortality, I'm talking all the costs. So they can move the lever. Well, there's a maximum and a minimum cost of insurance, contractually, the insurance company can charge. Whole life, every mutual whole life company out there, charges the client when they pay their premium. The maximum cost of insurance comes out of that premium, right? They know that's not going to be the real cost at the end of the year when they price, and they sell that risk. The delta between what they charged the client, what the actual cost was, they give that back. That's what the dividend's based on to the client. So cost of insurance is mortality. The cost is baked into the whole life contract throughout the life of the contract. If in the later years, the cost go up, because an insurance company's underwriting team is letting in too much risk, and they're paying out more claims than they expected, then what's going to happen is that maximum cost is rebuilt in, they're just going to lower that delta that the dividend comes back. So really, you can have an increase in cost of insurance and a whole life contract as well. It's just they baked that into the cake. Now, switch to IUL, I believe for years, it is term, right, with the cash right, you can pull it in your renewable term. And your renewable term. Well, the true, and I argue that. But in reality, we can control the cost in IUL, which we can't do in whole life. And this is where I'm scared for a lot of the IUL out there, because agents don't know this, and I believe it's going to hurt a lot of clients. So we use it very selectively, but I can control that cost. As long as I know I can control that cost, I can set it to where it's actually better than whole life, because when the client pays to premium in the early years, only the cost is coming out of the premium. So 100% of the rest of that premium for overfunding it is going into the crediting strategy and getting crediting from day one. And if you do an opportunity cost, which I've done, 5% whole life, 5% IUL, 4% 4%, IUL is going to outperform the whole life just because of that lost opportunity cost of the insurance company holding that money each year, and then releasing it. And you can see that in the illustration. So that was a big eye opener for me. And the final thing that got that I, we talked about quarter, I didn't even know what the heck a quarter I knew what quarter was, but I didn't really understand it until two years ago. And when I realized that we can do a point two's reduced paid up, we'll get to that later. It's similar, but we can close that quarter down. And if the insurance company pushes the cost insurance lever all the way to the maximum, and we pull the cash crediting that it guaranteed, not the index strategy, what the guaranteed on an IUL contract does have a guaranteed option to put the cash into. The agent has to do that, so that's the fear of if that doesn't happen. Actually, we'll never, ever, the cost will never exceed what it can earn if it's designed properly. You can't legally, regulatory, you say it's guaranteed paid up. I'm not going to say that because I'm a licensed person. But we'll just say it's just, it's the same thing, right? It can never go upside down based on the contract provision. So that was enough for me to say, that's what opened my mind to even consider representing IUL, because I don't need IUL in my practice. Whole life works really, really well. The only reason we even started selling it is because it really helps a certain group of clients, not all of our clients. And it works really, really well. It works better in whole life. But that was one of those three things that I had to overcome to even consider using it is understanding how those costs work. Before I bring Chris on, last question I have, when you shared, you said that there's three different examples. And IUL was, you used for two of those examples, but you still use whole life for one of those examples in your business. Can you just break down that fast and then bring up Chris? Yeah, so basically, we've been very blessed. We didn't go after this market, but after nine years, we've grown into two very high end markets, business owners, that are earning significant revenue, half million to a million a year, and surgeons and doctors that earn that kind of revenue. And so using an insurance contract as a quote, Roth alternative, which we would use, whole life short pay, paid up 65 contracts, generate income, that's really where the IOU has replaced. And the problem with that contract, this is a contradiction in our industry. I believe that as a family, you should have the most amount of death benefit you can afford. But if you're designing a contract for income, it's the opposite of that. So it's not one versus the other. It's both, but if we're going to use the contract as an income play, not as a legacy or covering a pension play, which we do that too, if we're using it as an income play, we want the best possible outcome in designing IUL versus trying to design a whole life, the IOU blows away the whole life. When it comes to income. When it comes to income. And you're using loan assumptions for that. And that, yes. And that's another key when we go to the third-pointed carrier and it goes, there's really bad carriers and really good ones that make sure the client's protected. But that's really the only vein we're using IUL. Every other vein we're using highly funded a whole life like we always have. I believe in that product. Chris, you didn't talk for 10 plus minutes. That's aggressive. Why don't you give a little bit of your backstory? Most people know who you are, but I think it's helpful. And then why don't we address the first point that Terry made as it relates to rising cost? Yeah, so my background, I used to be the director of business development for one of the top IUL companies in the country. I sold IUL for a long time. We actually had dinner last night and talked about our story a little bit. And after 4 1-1-1-1-1-2 years of doing it, I just, I kind of, I'm an opposite. I thought it was this amazing tool. And I was doing it all the right way, max funding, all the things come to realize that it just wasn't in alignment with my values and beliefs, with what I was envisioning that it wasn't solving the problems that I thought it was solving for people. And so for me, I just needed to make a big pivot. And quite frankly, when I made this shift from IUL, it's so funny how similar it is. Because when I made this shift, I didn't even really know much about whole life. I had gone to Cal College. I had gone to all the stuff and done the mentorship program and all these different things. And still, I was down there going to dawn being like, hey, man, why don't you get this IUL thing? And he's like, buddy, son, come on now. Doing his down thing. And it was because of the conversations with him that I decided to really question things and take a step back and dive deeper into the whole life insurance. And I'm like, I thought this is what I was selling the whole time. And so I made the shift. I went down this path. And I guess, so what's the first thing you want me to cover here? What Terry talked about when it comes to rising costs? Yeah, I mean, rising costs, like the way I look at it is the challenge is we look at life insurance, whether you're talking IUL or whole life, we're talking about our entire life, right? That's what we're after. It's like, I don't care what the policy does right now. I don't care what it does 10 years from now or 20 years from now. I care about what's it going to perform as throughout my entire life. And so one of the things I love about whole life insurance that I talk about all the time is the fact that it grows with you in every phase of life. It'll solve different problems for you at different stages of life. It's dependable. It's predictable. It's the financial stability and security that you can lean on. And so when it comes to IUL, the biggest fear that I have with IUL is that what, or at least the reason most people are buying it is for tax-free income. The way it's sold that people say that it outperforms whole life is in the tax-free income in retirement. The challenge is that when you get to that point in time, I mean, I've run models and looked over thousands of illustrations with pretty much every carrier that I've heard of, you know what I mean? And when you really break it down and you lean on tax-free income every single year, it almost always breaks down. And so I use the analogy a lot. It's like, I don't say IUL can't work. And I want to make that really clear. I mean, I've done this IUL challenge where I've asked people to just show me one illustration that can work, right? Your definition of work is matching the... Just match. For the policy to do anywhere close to what it says, it's going to do. So the premise of the IUL challenge is like, show me a policy that's 10 years old. I want the original illustration, the enforced illustration. And I just want, you know, given that the product is sold with upside potential and downside protection, show me a policy that's even done when it said it was going to do initially. Yeah. It hasn't been able to do it. And I've literally had hundreds of thousands of views of this stuff. I'm offering now Chris Nagel, after the match. We got $10,000 online. Nobody's willing to even show me one. You know what I mean? That to me. The biggest thing that I say is like, when I look at this and I go, all right, if I'm looking long term philosophically and fundamentally and just emotionally and morally for me, I look at it through the lens of like, I don't want to ever have to say I'm sorry to anybody, right? And I look at it through the lens of, how can we speculate? And I said this in my talk yesterday, when did it become okay to speculate with life insurance, right? Because when we look at it from a long term perspective, there's not one person alive who is fully funded a policy and used it successfully for income. All the ways that people are saying that it's the way that beats whole life. It hasn't been proven. It hasn't been proven. Go for it. So there's three things that you said that I want to kind of comment on. So the one thing is as far as the challenge to find an illustration that a policy that's performed to the illustration, between us here, I don't think that's fair because you can't find a whole life contract that's performed according to the illustration. The reason for that is because underneath these contracts is the general count. And the general count is a bond portfolio and with a mutual company, the policy order share the profitability of the company. And as interest rates have come significantly down since the financial crisis in 2008, every one of these companies had a deal with smaller amounts to buy options within IUL. I would be able to pay the dividend offset those cost insurance. So that, I don't think that's fair, but I'll give that to you, but it's a fair assessment. Well, can I just respond to that real question? I'm not having it. So I would argue that it's not an apples to apples conversation. Like you're not using whole life insurance as an investment alternative, the way that people are utilizing IUL. Okay, would you agree that whole life insurance can be used as a tax free alternative for income for certain clients? I don't think it should be a strategy, this is just me. I don't think it should be a financial vehicle that's utilized as an annual use of income as a volatility buffer, sure. As a strategic asset to use in down years to make your other assets perform better, sure. But not on an annual level. Not a straight income, straight income. Correct. How about a bucket approach for volatility and for tax brackets, depending on varying the income to fill up certain tax brackets? Yeah, sure. Okay. So in those two scenarios, again, IUL, and so the other thing you said is, is you don't know of any IUL contracts that have performed as they were supposed to for income. I know thousands I can show you that that worked really well in that arena. I think it's dangerous and the whole life companies and the IUL companies show using life insurance as an income stream for 20 years. And that's something I think in our industry, we need to stop because it's a really dangerous thing that they show. So I would agree with you on that, 100%. And dragging down an IUL could have some more risk than a whole life in that scenario. If it's not designed properly, which a lot of agents, most agents, don't design it properly. If it's designed properly, my opinion will all perform the whole life contract. I just can jump in here before, when you say you have thousands of examples, are those illustrations or those actual inflars? Those are actual clients that have been drawn down. Yeah, and that's part of the organization we're with now, because that's why how to convince me. And I mean, I've seen those and I mean, I can send those to you. They want to talk to those clients that are... They want to and grant it can submit some. That's right. We can... Well, the contract... Well, the challenges did the contract perform according to the original illustration. So that I don't... Yeah, but as far as you said, you don't know of one that we're... They're actually using it as it was... Sure. You're right, but here's the deal. You don't have to illustrate it with the max rates of the companies. Right. So that just goes to show the people that are selling them. If they sold... It's not a matter of how much money's in the policy. It's a matter of what are the expectations. Now, into your defense, I'll beat you to the punch. This happens with whole life too. A lot of people, if you sold whole life in the 90s or 80s in the dividend rate was 12% or 11 or 9 or 10 or whatever it was. And you bought that. If you look at the current assumptions in a whole life policy, now you're looking at... All right, a dividend's going to be paid every year and the assumption is it's going to be the current rate. And so dividends go down, policy performance is worse. This is where whole life gets horrible, man. Right. Because people are sold something that you don't understand what they're buying. And so you're dealing with that with IUL now. Like it's like the challenge nobody had to run the illustrations at the absurd 9% of suit levels, but they do. But they do. And this is where we agree. But if we had one person that would just do it right, if they won a 10 grand, they could submit it. And I didn't create the IUL challenge not to say that it can't work. In a vacuum, I get IUL can work. But if the plane's going to crash, 95% of the time, do I want to get on that plane? Or if there's a 95% chance I'm going to crash. There's just too many variables. But you're saying 95% what do you reference to the 95% crash? I'm just saying 95% by you all is actually going to last. Yeah, exactly. Yeah, exactly. Well, that's a, I don't even know if I agree with that. 95% by the end of life, if they're going to use it for income. Absolutely. Yeah. And you can see if that's the belief why, like that is IUL is evil. So I want to say that I don't know who the audience is here. But I want to say something that's really, really important. OK, number one, back in the day when we used to train agents, when we talked about the benefits of whole life or permanent life insurance. Yeah, sure. There's three primary benefits. Number one, it's the only product that's going to guarantee you to do what it's supposed to do. That death benefit will be paid no matter what term insurance you have to do that. Number two, you can have access to the money along the way. OK, number three, it's going to give you a rate of return. And something we used to say, say, don't expect that rate or return to compete with the stock market. It's not what it's supposed to do. But over history, it generally does better than other accounts that guarantee money like your bank or your CD. Sure. Right? And we used to try to implore the agents to never try to sell the dividend or the IUL just because if I put a newspaper at out today and said, I've got a product, you can put your money into that guarantees. Death benefit, you can access and it has tax benefits. And it's going to be right. Even if it's a point under a money market, people are going to line up around the corner to put their money in the net. We don't have to boost the illustration, which 95% of the agents do that. I actually agree with Chris. I agree with Chris. He's probably right. I don't know the staff. But I would agree a lot of the IUL contracts are going to blow up because of the way the agent designed it. Which is very problematic. If we can all agree on this, we all agree on that. If contracts blow up, that hurts everybody. Because people say permanent life insurance, but it doesn't sound too permanent if 95% of the contracts are blowing up. It hurts all of us in this room. We all are part of this industry. That's why every IUL contract we run, we run it 5%. We don't even run it at the 6.5% or 7. You can run. You are going to bring up two other points. I don't know if you remember that. You have a comeback too. OK. What was the other two points you're going to get on for? So the second point is the fact that you can't guarantee pay up an IUL contract. So I'm on camera. So legally you can't. But effectively, you can do the same thing. And this is where, again, some of the high-end IUL people that try to convince me don't know what I'm about to share with you. The guy who shared this with me is one of the architects of the product, really high-up guy that knows the product. So most of the people sound it, don't know it. The wholesalers don't know it. The IMOs don't know it. The IMOs, most of them don't know much. They're just sound the product of the month. That's the true. Which is scary, because that's the problem. So what he shared with me is, as listen, here's how it really works. And kind of pick the part how-and-life insurance companies general account works, how risk works, how mortality works. Mortality is the same. So why would, so guaranteeing paid up also has to do with the first point? Because of increasing cost of insurance goes way, way up. Then it's going to blow up. It's not going to work, because the cost out. So the two are married. But in reality, what we call an investment grade care company in the whole life space, which are probably the five you work with, there's certain rules they have to pass. Part of that is underwriting has to be really strict. Because if underwriting is letting in a lot of risk, and it's easy, that company is either going to close and sell themselves or costs are going to go way, way up in the future. So we have over 100 years of history, which is there's only one or two IOL companies. I'll even consider working with the rest of them. I don't trust them as far as I can throw them. We've got over 100 years of underwriting and mortality. I feel pretty, and their whole life company as well, their mutual company as well. So I'm not concerned about cost of insurance going up in these contracts. As long as I know, the company doesn't violate the rules of being an insurance carrier and having a strict line on the risk they want to take in, mortality is mortality. In fact, mortality has gone down. And I believe we'll continue to go down because the three biggest killers in our society, hard disease diabetes and cancer, no longer killers. My dad's 80, no rocks has lived past 70, because of hard issues. So modern science is extending life expectations. It means cost of actually gone down from what the actually we're expecting, which is a benefit. But back to the point, I can design a contract that is reduced paid up with whole life. The delta between the cash value and the death benefit is what it is. It's what I've learned over the years that's reduced paid up. Reduced paid up to me as the lowest death benefit for the maximum cash to not break the mech line. Otherwise, can we just bring the death benefit down to the cash value? That'd be awesome, right? Yeah, and I'm just going to, so just for the listeners, because there's people that sell life insurance, but there's also a lot of people that don't sell life insurance. So our PU is when you stop paying premiums and you can reduce pay up your policy. And in whole life, there's a world where you can stop paying premiums and the contract will continue to not implode, cash value will grow, death benefit will grow. But when you do that, the death benefit drops. And you're saying that, for example, just for an example, like let's say you have $100,000 for the cash value, and if you RP you, you could have $300,000 worth of death benefit. Yeah. And in every year. And so just from a context. So in essence, you have permanent death benefit for the rest of your life. You don't have to put any money into contract. There's enough money that a pace for itself forever. Right. But if cost of insurance goes up, there might be a point where the insurance comes in says, you got to put more money in this thing, where it's going to go away. Which happened with you, L, and it happened in the 80s when it came out, because agents were overselling the performance and minimally funding it. Right. That happened. So if it's designed properly, then you have enough cash in the contract. And one thing about IUL for people that don't know what IUL is, it's indexed to something like the S&P. It has a cap on a floor, which means if the S&P 500 in a year cycle goes negative, it's a 4 or 0. You can't lose any money. You don't make any money that year. The cap is, say, 10%. If the S&P does eight, you get eight. If it does 12, you get 10. It caps out of 10. So over 10 or 20 years, you get the average of that and it averages out, which we've actually tracked the real average using real historical cap rates, which the carriers don't put in their illustrations. We've done a lot of homework. We know the signs behind the scenes. So I feel really comfortable about our numbers, because we've looked back 100 years actually and tracked this. But back to the point, when you reduce the contract, the insurance company has an automatic risk, that cost of insurance is coming out of the performance on the cash, in a whole life company. When a coal life company says they're going to give you 6% dividend, you're not going to see 6% on your cash. You see something like five or five and a half. The difference is the cost of insurance for that death bank. So when I started exploring IUL, I kept seeing these reduced contracts. And the Delta was like 20% of what it was for whole life. And I'm thinking this has to be a MAC contract. And then the guys are like, no, it's not a MAC. How can not not be a MAC? And I couldn't sell the product until I understood it. I actually flew up to two home offices and neither one could explain it. And I got on the phone with somebody I know. And he finally explained it. And he said, listen, Terry, when a whole life company does a reduced pay it up and says that's the minimum, that doesn't mean the IRS won't allow them to bring it down further. I said, OK, well, why wouldn't they do it? I guess, why do you think? Like I don't know. And he says, well, how does insurance company make money selling risk? That's how they make their profits. So he goes, could it be? And I'm not saying they do. I love whole life. I only own mutual whole life. And the company's got to make money. And I want them to be sustainable. They don't make money. They go to business. None of this works. But could it be that they're not allowed to come down because then they have more profitability? Interesting. Where I well, it comes down to where it's such a small amount at risk. If you take the lever for cost of insurance and you push it all the way to the maximum allowable, which we'd have to have a mass extinction event for that to happen. My understanding is half the population would have to be wiped out. If co would killed 50%, then they would do that. That's kind of an old thing I learned a long time ago. But let's say they pushed that up there. Index universal life insurance every year we can reallocate the cash. It doesn't have to be in that index strategy. So if we believe, I've tracked it back 100 years, I'd probably leave it in the index strategy. Let's say the world falls and we believe that the S&P is just going to keep being negative. We can move the cash to the guaranteed account. The guaranteed account is pretty close to a whole life guaranteed. And it's like 4% right now, which a lot of the whole life contract or 4% of some of them actually went down to two in the last few years. But if you look at the cash and the contract at the guaranteed crediting next to the maximum cost of insurance, it's never going to flip. It's impossible. So I can't say it's guaranteed, but it will never go upside down. So what you're talking about is just reducing the corridor and just shrinking the amount. As you get older, the corridor can shrink. And so what you're saying is every year, you're going to meet with your clients. And at 65 or whatever age they stop funding the premium, you're going to shrink the corridor to the maximum level as they get older, that corridor is allowed to shrink legally. And so you're going to manage that corridor to reduce their cost to the maximum capacity. Is that what I heard? In essence, but I would never do an IO contract where I had to have that meeting at 65, we would be using all life. We're using IO to fund it over a five or 10 year period and we're managing for that 10 year period and it's done. And we've got it designed from that point on where it's self-sustainable. So yeah, for 20 year funding, meet them 65, make sure that's done. We wouldn't use IO on those cases because of that risk. Self-sustainable. We've closed the corridor down. You give it like the corridor gets smaller as they get older. So if you're not actively managing that corridor every single year as they get older, you're not eliminating the risk. Because the corridor is larger the younger they are, the older they get, the smaller that corridor is allowed to become. And so an 85 year old can have, if there's a million dollars in cash value, it could be, I think it's like a 5% corridor. So there could actually be only, say, $50,000 in addition on insurance. So you could have a $1,000,000, a cash value and then a million $50,000 death benefit, right? And so that corridor is smaller, but when somebody's 50 or 60, that number's bigger. Correct. So every single year, that corridor is allowed to shrink. So if you are not actively managing that every single year, you're not, it's not efficient. Well, it depends on the care. So this is a much deeper conversation, probably not appropriate for a podcast, but we do design the contract so that it gets, so we have a funding period where you have to keep that corridor open per se. So that the person can fund it. Again, these are highly sophisticated clients. This is not mom and pop or your small business owner. We would never use IOL. It is, as someone said yesterday, it's a far versus enough 150. Whole life is enough 150. You can rely on it, set it and forget it. It's never, you never get in trouble. IOL needs a lot of finesse in maintenance. So for the type of client we're using it with, they have a huge amount of cash. We have a client right now, it's got a million dollars, but a hundred thousand here and an IOL for 10 years and they're done. Those are the types of cases we use IOL for. That's it. We're not using it for other things. But you believe that IOL is better than just investing in the markets? Well, that's a different conversation. Yeah, I'm just kidding. I don't think I even heard it say that. Although I did hear you say it's a raw order. So I will say this. So everyone of my clients that are AOM clients because we do manage AOM, if they don't ask me, I make sure and tell them that I don't have a penny in the market. All my personal wealth is in life insurance. So if you have a problem with that, we might not be your firm, but if you want to be in the market, we're going to do the best we can, but we teach them what the real returns of the market are. I'll go on camera saying, I believe life insurance, well, I'll perform the market. If you measure it correctly, most CFPs don't know how to measure it correctly. If you measure it correctly, I believe life insurance will outperform the market. I believe whole life insurance will outperform the market once designed properly. And for those cases that a Ferrari is appropriate and that extra maintenance is appropriate, I believe I will outperform whole life. So yes, I do believe. That makes sense. That makes sense to why you believe, but you believe. So your life insurance above market. Now, you might get a lot of comments saying this guy's out office rocker, how the hell can whole life insurance outperform the market. I'll be glad to show you the math. Yeah, well, I'm the real number. That's part two. So what I'm hearing though, like from you, and we talked about this a little bit last night, but and you mentioned it in your talk yesterday, is that you'd be worried about your clients. Like you are the key to your client success, right? And so one of the biggest problems that I have with IUL is that they're way more risky than they're led on to be, that you can lose money in them, right? And the active, active, active management of them, if they're going to work, is absolutely essential. And you are the key to your client success in that IUL. Right? So try one difference is we're not, I'm not a life insurance agent. We are a conference of planning firm. So we're not selling a policy and then never seeing the client again, which a lot of the IUL agents do. We're meeting our clients quarterly, we're managing their investment portfolio, we're managing IUL like a bond alternative. It's actually easier to manage the IUL to your points easier than the equity side. But most agents that sell it don't do that, and that's a risk. So we're a little bit different in that approach, but yes, you're right, I have the manager, I have the manager regularly, just like I have to manage a portfolio. So that's part of our succession plan and our practice is something happens to me. We've laid all this out of how these things need to be managed. So don't you think that's pretty scary that you have this product that needs to be actively managed like equities, but is regulated like a regular fixed product? That's a good question. I do. I think the industry needs to bring more regulation to the product. I do. I think it's pretty scary. We're licensed, but a lot of people selling it are not licensed for that. Sure. Yeah. I guess for me, like what are all of them? It's actually an interesting question. What if, and I'm not a pro-regulation for the record? Neither am I. But what if IULs you just had to have more licenses, like you would have to actually invest? Because big thing is whole life insurance when set up means properly, we're not selling it as an investment. People are attracted to our message, not because it's an investment. I feel like the pitch for IUL is like, this is the best thing since sliced bread, but you have people that aren't going to be around for a while. They don't have experience or working with bad companies. They're not structuring it. And then they're going to be gone. And so all those things are you're setting. And if it's like, if it's anywhere close to 95%, even if it's 50%, that's a train wreck. Right, exactly. And it's over 50 or sure. But going back to like, that's an interesting thought that you have. Yeah. And let me make sure some of my friends in the industry, like what do you talk about more regulation? I'm not for more regulation either. I don't believe you can regulate morality. Like, you know, found on the investment side, I'm a fiduciary. You won't see that on my website. Clients ask, why is it on your website? Because I don't believe you can regulate morality. I know commission brokers that are in commissions that take far better care of their clients than fee-based. But when it comes to something like IUL, okay. It breaks my heart. Even whole life in general, you know, life insurance has a bad reputation for a reason. A lot of the people selling it are just selling a product and they didn't understand it. And that hurts all of us that are doing it the right way. And IUL, to Chris' point, if it was done the right way, it probably would have such a bad reputation. And I don't know how else to fix that. But I think the carriers are very responsible because a lot of the carriers just don't care and they just bring in the money and they don't really care about the consequences. And that, I think, somehow that has to stop. Maybe it's us changing it, but I do agree. I think that you need to have a 65 license or something to sell IUL because these agents that are selling it as an investment have no, I'm sorry, I'll just say they have no freaking idea what they're talking about. I'm sorry. I agree. I mean, I think you IUL would go down the VUL path, right? Where, I mean, my team looks at VULs all the time, you know? And one of the things that we see is like, there's a lot of really poorly structured VULs and there's some that are decent, you know? And so what I know is there's a lot less volume of VULs because the barrier to entry to get into it and sell them and whatever. And the people that are actually selling them, they're part of a more comprehensive plan because they're licensed to do other things. They have different velocities. They're trying to solve different problems, right? And so to me, that's what it comes down to. Yeah, I talk about belief system. I mean, I really had a thing against VUL because I saw a lot of bad stuff. But I've messed some guys that, and I, we don't use it, but I messed some guys that sell it and they do it the right way. And I'd open my eyes and wow, it can be done the right way. But that's far and few between the... Actually, I want to ask you a question. And this is something when I think about it from my values and beliefs, one of the reasons that I am whole life all the way and why I am so rage against the machine for IUL, okay? So my, when I look at whole life, and I think about, what am I doing? When I put money into a whole life insurance policy, I'm preaching to the choir on this because I know you know this and feel this way. But you're partnering with a life insurance company, right? Like as long as that company is financially stable, which there's no more financially stable company in the world than these participating mutual companies, historically compared to other correct alternatives. And when I put my money there, as long as I pay my premium in that business, or that company's in business, I'm solid, right? I'm effectively a shareholder, a business partner for that company. And as long as we're there, I'm gonna be solid. Now, it may perform a little worse, it may be better depending on what dividends do, profitability, mortality costs, all these things. But at the end of the day, I know that I'm basically saying, all right, insurance company, what you do best is get me the best rate of return possible with the least amount of risk possible. We agree? We do, I appreciate it. Okay, so that's why I give the money to the whole life insurance company. Not because I want sexy returns, not because I want to beat the market, because I want to save place for liquid accessible capital, for emergency, for opportunity, for my legacy, for all these things, right? When I take money and I say, all right, let's have a conversation about IE well. As soon as I put money into an IE well policy, I'm no longer a partner with the company. I'm, by definition, a profit center of the company. That is just the way it is, the way fundamentally, we can argue semantics about the moving parts of the policy and the corridors and the charges and all the fees, but fundamentally and principally speaking, if that, I could pay my premium and the company could still be successful and my policy could still technically fail. So fundamentally, fundamentally and principally beliefs, and from a values perspective for me, I look at that and I'm like, I want no part of that. Like, I, and it really bothers me to see all these IE well agents out there right now. And I'm sure this bothers you too, so I'm not saying this because I don't, I don't think you do this, but I'm just sharing kind of what I see and why I am so raging on some machine, is that so many people are like, oh, do what Ray Croc did, do what, you know, JC Penney did, do what Walt Disney did and then they sell people IE well when IE well didn't even exist when they were around. You know, do what the Rockefellers would do, Gerrick Anderson just talked about, he's rewrote the damn book because people were using it to sell IE well, right? Like, and so it really just comes down to, they're saying that, you know, all these IE well agents are using the fact that these companies have been around for 180 years, it doesn't matter within IE well. A company can still be profitable, successful, prolific and whatever, and your IE well can still fail. And so what do you have to say to that? I disagree with part of what you said. Okay. So there's IE well companies carriers out there that are for-profits, stock companies and there are mutual companies that also have IE well. But you're not, but that's still with the mutual companies. But I look for one. But a mutual company, right? If they're a mutual company, all of the costs, all of the expenses from the CEO salary down is public record. The profit of the company are shared with their shareholders, which are the policy holders. So here's what got me over there, because I had the same hurdles you did. When I got down with this one specific area, I'm not gonna, in fact, I don't really want to mention the name, but it's really the only care. I have a feeling I know who you're going to be. We write business with, right? And they are a mutual company. They have multiple insurance companies. But I got to know at the home office, the chief factory, the chief product designers. And I saw how they designed their IE well. And in fact, their IE well is not competitive. In fact, they lose a lot of sales. In fact, when AG49 came out, they didn't have to change anything, because they weren't boosting their illustrations. They don't have closed books of business. So they're doing everything right to benefit the policy holder. They're not trying to benefit the machine. It's a cleaner, simpler version of most IE wells. Right, I guess, I guess, and after going through the mutual company that blew up on me, I don't trust any company, but I trust this company with how they've designed the product enough to represent it. So my reputation, look, it was very painful to go through this demutralization a few years ago. I wanted to leave the business. I had to look for clients in the eye. So I don't need a cell IE well. We have a very successful business. Every one of the clients that we serve, we can use whole life for. I don't need IE well. So why am I doing this? Because I truly believe, I truly believe in the research I've done. I'm a math geek. So I guess that I know how many people have actually done real caprate history back 30 years, and then back tested it using the tools we have on the investment side to really see what's going on. I know my numbers and my science. I can show that to anybody, that's what convinced me. And then we actually added buffers. We did worst case, worst case, worst case. And we even made it more worst case than reality. And so okay, as long as we do this, we feel confident in the product. So not a lot of people do that. So that's my answer to your question is, I believe the carrier that we've aligned with does consider themselves a mutual partner with their policyholders and they are a mutual company. And I've seen it in their design. I've seen other companies that's not designed that way. And it is a profit center. And this company's not only given a profits based on five less years of premium finance charge, they've also given up boosting illustrations and given up sales. I know Asians, I won't write them all. They suck. And I try to say, your son of a company has a 12% cap that's probably going to drop it in a few years. This company's giving an honest rate. And the agent says, well, this is easier to sell. So I agree with you, but could it be Chris that, and you were in your carrier took on a lot of risk back 15 years ago, I said, that carrier's going to be in trouble and they were, is it possible? You had some, and we all have our issues, right? That, you know, being a little bit open-minded, I understand where you were, but not every carrier's the same. Maybe there's some differences. Well, no, I just look at it. Like what I have come to the conclusion for me is, is in the reason I have the very polarizing beliefs that I have is because of the fact that it's not a, I don't want to trust people because the company that you're with right now, leadership can change. Vision can change, directions can change. So what I know to be true is that the contract, because make no mistake about it, the contract and the languaging in the contract with a whole life policy protects me, the policyholder, the contract, maybe. The contract, as long as I pay my premiums, I know it's going to be there. But if you go through a due mutualization. So, so, so, sure, sure, sure. But that's, so are you from our Bobby Salmonism? Of course. Have you read his stuff on this carry that went due mutualization? Yes. You see what they've done with those levers? Yes. So this company has a guaranteed dividend rate, which is total hogwash because they move the cost up. And it's, so that's a mutual company. So leadership can change with any. That absolutely can happen. And, and by, listen, there's, whenever we talk about a guarantee in a product, we're talking about that guarantee being guaranteed by the company. And if the mutual company goes haywire, so to speak, or starts making irresponsible decisions, or they manage blocks of business improperly, or whatever, then sure things can happen. All I know is that with mutual companies. And, and here's what I'll say, though, also to the, to the, to the company that demutralized, to that company, it's like, all right, it was like you were an advisor, right? Like you were, you were the agent. And Caleb, you were two, weren't it? Yeah. So you guys both went through this with this company. So you both experienced it. And while I created a lot of headaches, and there was some pain or whatever, at the end of the day, nobody lost everything, right? Correct. People were able to 1035, people were able, like in the worst case scenario, if you, if you would have stayed with that company, it once had been ideal, it once had had as much upside, but the guarantees would have still been there. Correct. Correct? Yeah, guarantees didn't change. Okay, so from that perspective, when I put my money in a whole life contract, I'm protected, right? I can't lose everything. It might not be as good, and if something horrible happens like that, I could 1035, I could make different changes, I could do different things, fundamentally speaking, in an IUL contract, leadership can come in, the levers can change them, the market, the economy, the variables, there are all sorts of levers inside of every IUL contract that can be... But there are contractual caps on those levers, and that's what I was talking about, the carrier that I'm working with, they have put these caps on these levers that I've not seen any other IUL do, which is the favor of the client to protect the client, not themselves. So I agree with you on that, but every carrier is different. Cultures important, that's why now I actually fly to home office once a year, a couple of carriers, because I wanna see what they're doing. I don't, I wanna look on the numbers, but leadership is really important to me. Okay. But what I'm also hearing from you, and I just wanna make this point to anybody who's watching this like, whole life guy versus IUL guy, is he's vetted, and this is a compliment to you, by the way. He's vetted this, and out of all the dozens of companies you've looked at, and most of the major dozens of companies, you've pretty much settled on one company. One, maybe two, and the second one is half and half of trust. And even in the one company you found out of the dozens of companies out, actually 70 companies out there, I don't know if you've checked them all out, but like selling IUL, you use one company right now, maybe two, and out of those companies that you have access to, you use it only for a very small percentage of your clients. Everything else is gonna be whole life. And even in those people that do that, you acknowledge that the key to those policies being successful long-term, rides on your shoulders. Correct. Or the systems we put in place to protect. Okay. Correct. I think a lot of us agree. I think we agree more than we disagree. My question for you, Terry, is when it comes at early cash value, what performs better? We're designing contracts that get 85, 92. That's a great question. It looks quite a dearly on. Yeah, so, and again, I can't speak for a lot of the other product designs without you all, because like, so the biggest company out there that everybody's selling, I can't say their name, but they start with an A. To me is one of the... They end with a Z. That or not? Which is one of the worst. I would not touch them forever. I can't even look at their design because I can't get past what the company's doing. Why do you think it's the number one selling I UL in the market right now? Because it's easy to sell. In commission, maybe. The fact that they get 165.0 contract, do you think that has an impact on them? I didn't even know they did that, but yeah, I would assume they do. Right? So, yeah, that's the problem. In fact, the carry-on riding with this one of the lowest comparates. I'm... It's horrible. I mean, what's not hard? No, it's good. It's good. It's good. Yeah. But compared to the reader, and the read-on sucks, the read-on fraction. But guess who's getting the read-on? My clients are getting that money. You're really not funded to pay it with. Because we agree. I know, it sucks. I'm not going to lie. We were talking about something before I said that. What were you talking about? Oh, the cash value. I wanted that. Early cash value. Yeah, the credit. So we actually have a current case that we were testing. And it's interesting because you can put... The carrier we use, you can put what's going on at early cash value, right? Right. Which when you put an early cash value writer on you're reducing the options budget. So for your listener, so I don't know what that means, is as sure as coming when they buy options, those are real instruments on the market. And so they restrict the access to your cash in the early years, because if you get your cash out, they have to cash in those options, right? So there's a surrender charge. So you can eliminate that, which is also going to minimize the performance on the contract. Now, this is just made up numbers. This isn't real, so don't test me on the... But maybe it brings the cap down to a five instead of a 10. But it gives you full access to the cash. So I believe whole life, funded properly, was better for early access to cash than the IUL because of that, because you're not performing as well. Well, when we've run our tests, it's almost a wash. It's almost a wash. And so it can be designed. This one carrier, I don't know about other IOs, you can pretty much match what whole life is going to do for early cash value or reducing the performance, which is going to be similar what the whole life is going to do. I had someone recently on my show that said that you can get lots of early cash value in IUL and take loans at like 3%. And I'm like, I couldn't fact check them on, but I'm like... I had someone bring that up to me a few months back. And I just don't... And I don't think that might... And BS radar goes off because it's like having that sustain the company. There are some companies that offer... It's almost like... I don't want to say about this, but it's like an introductory rate. For the first portion of the time, the contract bill offer lower interest rates. It's like credit cards. It's like a zero percent credit card for you. Listen, here's a deal. It's insurance and we'll agree on this completely is that there's no free lunch, right? And anytime that... And that's what I really don't like. And this company that you are using sounds like they do things much more cleanly. And there's not a lot of levers in moving parts more than necessary, right? Because by the nature of IUL, there's moving levers, right? The problem is a lot of these companies have added more levers than necessary. And different companies have different levers. And so you can't just go through and say, these are the levers because every company... With every new product comes out with different things. Every regulatory update with AG49 and 2015, AG49A and 2020, AG49B and 2023. Like it all changes and the companies constantly roll out new products to add new levers to get around regulatory updates to make it. So they're trying to like rain in these illicit, illustrative tactics that, you know, whatever. And then these companies have actuaries. I equate it to like the feds chasing Capone back to the day, back in the day. Because Capone could just like maneuver because he didn't have any regulatory crap to jump around to like be caught. But the feds had to operate by the book and do these things. And by the time they got to him where he was, he's like, haha, suckers, I'm over here, you know, like, and whatever. And that's what's happening in the IEL space right now. And so what I know to be true and what I see all the time is whether it's multipliers, low volatility indexes, engineered indexes, these low interest rate loans. If you're getting a low interest rate loan and a thing, I guarantee you it's at a cost somewhere else in the policy. It is. Yeah, so my third point was I can get to yesterday was, the title was Caprates, but it was really what Christus mentioned, right? And that's why my argument against whole life and being a math nerd and an analyst that knows how the numbers work, know that it's all BS, right? And it's just for sales. And so that's why I would argue, and agents would say, well, getting a bonus, getting this, it's like, no, it's all smoking. It's all smoking here, right? Yeah, yeah, yeah, yeah, we agree with that. So having to align with a carrier that doesn't play those games, that was going to be my last point was, was carrier selection is so important if you're going to do it. It is with all life too. I do believe it is a weak argument to say, I, you over his whole life, if you're only going to say, I'm only going to work with one to two carriers. That's why it's the date is a very fun. You know, but I do appreciate it. Like, I think it's, I think it's going to be helpful content because it's a listen. I actually think I'm more aligned. Like, I agree with, there's like, I, Chris called me in the evening. I like it. No, but it's like, remember what I did a video the other day and I kind of like shared pros and cons of both sides. And like, I understand that that can tick, tick people off that want me to be like all in what, no, I, I feel like life insurance is a tool. My big problem is when you look at the amount of people in our space and the companies and the network marketing and like, you start stacking it on and on. And it's like, malpractice and these people have a license that you don't need to be a genius to get. And now we're not just, it's like people are going to get hurt big time. And then regulations that we all don't like, there's going to be regulators, regulators hate what we do. And they're going to ruin it for everybody. You're exactly right. That's what's going on in the investment space right now with what we're doing. I mean, these new, these new roles on, you know, it's insane what's going on. And I can't really speak on that space because I don't, you know, but yeah, and that's the problem. A few bad apples, which then gives all of us a black eye then the regulators come in and they cut and they take away what's really good for the client, not realizing. I have two more questions. So would you recommend people do like infinite banking with an IUL or, you know, utilize their cash value in the first five years within an IUL? So infinite banking is a different subject. So we believe in the philosophy of infinite banking. It's we teach our clients how to use life insurance as a bank, one of our clients or contractors, big developers. And they used our life insurance as a bonding alternative and a banking alternative. So we very much believe in the concept. And the infinite banking world is a, is a, is a little bit of a tabooish. I mean, I have a lot of history, new Nielsen Nash, actually our old company built the first calculators to prove, because the regulators are going to shut them in for the banking. And we helped prove the validity of it, which the validity of it, the only reason it works is the very fine line, is it because you can access earnings that should be taxable through a loan and not pay the tax. And that's the arbitration that makes work otherwise. It collapses. So it's a great concept. And then all the things we know. But I don't really want to talk about the infinite banking space because there's a lot of infinite banking people out there that I don't know if they're doing it the right way. And I remember a decade plus ago when I was training in the industry, there was a lot of infinite bankers that were doing things in my opinion, really wrong. I agree. And so it's hard for me to comment on that. So I'll just go back to what we do in our, in our, in our, in our practice. So if I have a contractor that is building a huge vat of cash, and it's either or actually, black and white, I'd rather the cash value whole life from a quality dividend, a mutual dividend company, is going to be the ideal tank to use. However, the variability in funding usually is better than IOL, brings. And we can use that early cash rate. Because a lot of times their income is very, very influx or they hit a really bad time. And so having some of that flexibility, in fact, one, we did, we did both. And we, we show the client both options. And we give the client the complete transparency. Here's the risk of IOL. What do you want? One said, how about I do 50, 50? That's a great idea. We did, we did both. So it depends. But if it's a black and white thing, I think cash value whole life-bunded properly, is going to be better for a banking type concept, in most cases. I'll say this for the, for the, for the not sophisticated client that IBC is being used. I'm not sure it's right. But in that case, I think IOL is a much more dangerous to get dynamite for those types of cases and those clients than whole life. Is it a follow-up question? And then I'll get to you, Chris. I actually have a follow-up question. OK, so my follow-up question to that is when, in your, the way that you illustrate, not the way that other people illustrate, when does IOL outperform whole life in the cash value? The reason I'm asking this is, it sounds like income is the play that you're, that you're, that IOL fits. And it's interesting because I went through the same demutual process. And the conclusion that I came up is, I'm not going to sell life insurance for future income. I'm going to, I'm going to literally look at the first 10 years and then we'll go on from there. But I'm, I'm not going to sell something for 30, 40 years from now because I realize like how naive I was and how everything can change. And so that, so for me going back to what Chris said, is like, I want something that is structured in a way that if two years, three years from now, 40 years from now, I could cash out, I could transfer, I have flexibility in funding, which there's flexibility. But like, I want, or show me the money, don't show me what 30 years from now could look like if I fund this thing properly. Yeah, so I think that running an illustration that shows like an income stream from 65 to 85 is dangerous. Yeah. OK, we run it for our own testing purposes, or we're all, you know, but we look at as a buffer strategy, which for those of you that don't know what that means, you know, if there's a down year in the market, you don't really want to be pulling money out of your stock account because you're selling out a significant loss that won't recover. So you can use something like a life insurance contract to supplement that income for a couple of years until the stocks recover. However, we also look at it as a buffer strategy for taxes and tax brackets. So not to get, we don't have the time to get into that. But, you know, I want to minimize the tax liability for my client. And so between 65 and life expectancy, there could be a lot of variability in income. And so the life insurance can be a great tool to help mitigate taxes on the income through a bucket approach. Did I answer your question? No, you know, so yeah, when does the overlap in your illustrations like when, when do these life in IUL break even? That would be a maybe a year. Versus whole life. I mean, cross over point. Yeah, yeah, cross over point. Versus. Year five to year seven. So depending on how, I mean, that's pretty competitive to whole life liquidity. What is in the first year to how much liquidity is your client's getting if they want to surrender their policy? So that depends on if that, so if we're building it for income, right, we don't want the early cash access writer, right? So we want the full index. Yep. So you have surrender value and actual cash value. So that, so the cash value is, is, is, is what's getting crediting on, but the client can't take that money. Right now, I just care about surrender value. Yeah, so it's very similar to a whole life contract. It's, it's less, it's going to be less than a whole life. And a whole life's going to be better in that scenario. Usually it, it depends. Yeah, it depends. But are we talking 50, 50? Are we talking like it varies? OK. It, it, it, it really does vary. And the first year, the first year, the reason I asked that is like, if everything hits the fan, it's like, what is the 1035able? What can I, what's mine that I could cash out? Yeah, only the surrender. Yeah, that's why I asked. Right. Yeah. And, and so, and I will say that if you turn off the early, the enhanced cash value writer, right, I will, is better than most whole life. Although there's some whole life companies out there that have created some new products, I can't mention the name, high early cash value that actually are pretty darn close. So, so, you know, I think, yeah, I know you have got. Well, no, I mean, I, there's a couple of things that I just keep kind of ruminating in my head. It all comes down for me. I, I always speak to what are our values, what are our beliefs. I think people fail with their money because their money's not in alignment with their values and beliefs. They don't even know what that means. And I haven't spent enough time contemplating what they're actually trying to accomplish for. So I'm not saying that's you and your clients, but I'm just saying in general. I've been doing a lot of like deep dive research for myself on once again, my values, my beliefs and where I think the economy's going, what I think is going to happen. And I think what no matter what, there's always risk, right? The risk of taking a more conservative approach is that you lose some upside. And there's an opportunity cost to a conservative approach. The risk to taking too much risk and, and, and, and doing a more risky strategy is that you, you, you have the potential of upside, but then if it, if it goes the other direction, you lose, right? And so, with, and this is why I'm so hard on the IEL challenge. And you know, when we talk about, oh, well, you can't do a whole life challenge. Well, whole life isn't sold on upside potential. They didn't provide the upside in the greatest bull run of all time. So where's the upside potential? I wouldn't have a problem with the fact that they underperformed if that's not how they were sold every single day on every single TikTok and Instagram video that I've ever seen. So that's that, but that's not even my point. So moving forward. And this is a question for you. Is this something I've been contemplating a lot? I made the bold statement yesterday and I saw you in the back of the room kind of like shaking your head or laughing or that we know is that whole life is going to outperform I you all have in the next decade. And the reason I think this, and I'll just make my case and I want to have you respond. The reason I think this is because I believe that we're in, we have no choice but to be in a bit of an elevated, interest rate environment compared to where we've been. I believe that rates actually will wind up going up even higher than they are right now. They stay where they are. They go a little higher. If they come down at all, I think it's going to be a per short period of time. That is what it is. Now, my belief on this is I could be wrong, right? But I like and Caleb and I've answered this in the past is like, what's the upside? What's the downside? Can I live with the downside? And good question. And so when I look at this and I see what I believe to be true, even though I fully know I could be wrong, right? We just have to think what I believe to be true. Do you think interest rates are going to go up or down or stay the same? It's one of three things. It's got to be one of three. Up, down, stay the same. What do you, I'm question. I have no idea. No idea. I don't think any, I think anyone that tries to predict when interest rates are going to do is follow themselves. Okay. That's a very, it's a very, it's a very, it's a very, it's a very, it's a very, very road ahead. It is. No, it's totally great road. And so what I, but I think it's important as advisors to be considering the direction things are going to go. Right. Right. And making decisions accordingly and also making sure whatever decision we make if we're wrong, we're still okay. So, so here's the answer about whole life versus I will. Come back to 2008 and you know, really a lot happened in O8. Could do a whole podcast on that. The world lost 80 years or GDP has never come back. But you have to realize that with an insurance company like a mutual whole life insurance company, it's one block. You can't open and close a block. Right. Everyone's sharing in the same pool. And so you have decades of this massive account we call the general account. That's the big cash reserves that our insurance companies have. And that basically is an institutional bond portfolio. Like any institutional bond portfolio, they're going to have short, mid and long term, you know, blocks of business in there. And so you go from a period of the 50, 60, 70s, right, where you had interest rates. Let's say you have a block paying 7%, 6%, 5%, 8%. And when the great financial crisis happened and even before that interest rates comes down, when those blocks come to maturity, they have to buy into the, to the yields of the current of the current time. Sure. A few years, you can, you can kind of mitigate that, but no one expected rates to be so low. To be underinflation, which that's a whole another story because that tells us that the government's manipulating things because that's not normal. It's not normal functioning economy for 10 years plus. So for 10 years, every company out there, I believe there's going to be more mutual setter going to fail. I believe you have to be with the big four or one that's like the big four because they all have to figure this out. And I've been out there home office is saying, how are you guys mitigating this? And most don't even know what I'm talking about. Some do because you've taken huge, we're talking billions of dollars of capital that they had to reinvest at lower yields on products that they assume are higher yields. It's going to take a long time to recover it. Then you take COVID and rates spiked, which means they just had a huge capital loss and a lot of that account. So now rates are going up. I do believe mutual whole life is going to start doing better, but it's going to take 20 years. I think in the next 10 years, it's going to be a difficult road and I actually do believe index universe life will outperform whole life in the next 10 years. Bobby Samuel, send me a degree. In fact, he didn't study on this and showed this because of that lag. It's a lag. It's a lag. The dividend rates are going to chase now typical what's helping that actually. And one of the reasons dividends have gotten better is because mortality is lower than they expected because people are living longer. That's actually helped that a little bit from the original assumptions going back 30, 40 years ago. But one of the things that happens in Tom Wall actually told me this for the first time he goes, if zero is a hero, then the cap is the trap. And so the cap at 10% being the most you can make, if you have a couple down years in a row, you need a lot of cap years to get back to the average that you're looking for. And so that's where he's saying the cap is the trap. When we... Can I come on on that one? Sure, sure. I'm going to get it. So again, the agents that sell the stuff and forget about it. And I see a lot of IEO policies on the holy crappier agents that talked to you in 10 years. It's really scary. That's true. But remember, if we're managing, we are firm. We're managing this. We need our clients at least once a year, usually quarterly. We're talking to them all the time. I manage my own portfolio models for many years now where the firm where we have an RAA we trust. So I'm very active. And so obviously, if it's a world where the market's going to tank, we're going to move it to guarantee... To the fixed account. To the fixed account, which is getting the 4%. We backed it to test it as back to the Great Depression. And so we've kind of looked at those zero years. And still, I'm not going to say on camera what the rate is. I'll tell you this behind the scenes. I'll show you the research. I feel very confident that in the next 10 years, we're going to be okay. But I also know that if that worst part of the world, that end of the world, scenario happens, we can always move it to fixed account. I had an interesting interview. And this is neither here nor there. But an interesting interview with a guy named John Wolfenberger. And he runs bullenberrypropets.com. He was going through all his statistics and just research. And he shared with me that Warren Buffett's favorite metric of valuation of companies. And when he invests in different things, it's how he makes his decisions. This one thing. It's like literally the one thing. And I went after the fact that research, I can say what I found. But this statistic, this one metric, is saying that the market is going to be worth 50% what it is today, 12 years from now. Which is a crazy, crazy bold and sane statement. I almost didn't believe him. But I went on to the Fred Stats and all this stuff. And it's true. If he's not right, even if it's the same as it is today, 12 years from now, are you well screwed? What do you mean? It's true. He's saying that it's 12. That the market is so overvalued right now. Because of the fact that the price for earnings ratios, like PE ratios right now are the highest events. But as we continue to print money, do you really think that that will cut in half? I'm just saying at some point in time something has to get. We're either going to have an inflation problem or we're going to have a deflation problem. We're going to have a financial crisis. One of the two is going to happen. And you're saying when that happens, people are going to take liquid, liquid, a third. And so what I'm saying is having whole life over the next 10 years. And the reason I'm bringing this up is because having whole life where it's this slow, good, dependable growth curve, whatever is even more valuable. Whereas IUL, if it's attached associated with an index and the market volatility is all over the place. And furthermore, if interest rates keep going up, I'm partnering with the company that's managing this bond portfolio equivalent. And so I'm letting them manage that risk. I'm letting them get me that return. That's what I'm doing. If I give them my money in an IUL, all that is doing is controlling the bond or the options budget. Right. And so there's two variables there. So if they have the options budget and their options budget increases, well, typically speaking, all this market volatility that happens increases bond costs. This happened several times over the last decade. This is one of the reasons that in the greatest bull run of all time, IULs performed worse is because it's not just because the options budget went down. It's because options costs also went up. And I mean, if you look at Bobby Samson's index ranking, this is a thing. The cost of a 10% cap. So you bring up good points. We could have many other podcasts going into the series. Yeah, we should do that, right? Especially talking about the next 10 years, what could happen? So when you say the market, I mean, how are we measuring the market? I mean, the S&P 500, which is a fraction of the number of public companies you can buy out there. Seven companies bring in 30% of the returns. If you take out those seven, the S&P has done about 3% over the last four years. That's pretty gross. Right. But the P&E of small and mid cap, not even, then the next is actually small cap. I can't really talk about investments because I am licensed. And I have to get approval for that. But the market is 13,000 securities. And so when most people go on record talking about the market, they're talking about the S&P, which is a small. Yeah, that's the small. And I do agree that there's going to be a huge, I believe. And I'll hopefully I'm not breaking any rules here as a licensed person. But I believe there's going to be a wrecking thing. And a lot of that. I do agree. Let's go back to the IOL and the risk in that. So we use IOL that's with the mutual company. That fixed account actually went up the last year. Like the whole life did. That fixed account is directly benefiting from the general account, just like their whole life sister company and the others. And so let's say that happens, we can move the cash in the IOL to the fixed account. But something we can do in the IOL that we can't do in whole life in a world like that. Let's say we have a world that just everything tumbles down, right? So with whole life, the only way for a client like a business owner of the May of cash oil issues is we have to let the contract APL, right? If they can't pay the premium. Automatically premium. Automatically premium. Automatically premium. If you ever pay the premium, hopefully that'll work. So where IOL, and by the way, for the agents out there, we never tell our client what the minimal premium is. If the client wants to start an IOL with the minimal and hopefully pay more in, that's a big problem in our industry. Every IOL should be max funded. If the client can't afford it, then don't sell them the contract or lower the death benefit. But don't sell them minimal. We don't even know our clients know what the minimal is because we don't want them to get in trouble. But at least if in a world like that, we can say, hey, all you got to do is put it this in the contract and you'll be fine or let the earnings on the contract. I get all that. But once again, this goes back to what you're saying before that we talked about is like, your active management is the absolute key to this. If you're not managing this on a literally a quarterly basis, which most people can't be successful meeting once a year because if they're meeting every client they have quarterly, when are they going to have time to actually go out and sell and prospect and help? All these things. And to be fair, actually, the AUM side is much more active. The IOL is you don't have to manage it quarterly. I mean, it's an annual cycle, right? So it's really not a big deal. It's easier than managing it. That's not once again that comes down to the bond pool that comes down to the company because a lot of them have monthly. That's getting the smoking mirrors or something. Is there anything else you guys want to bring up before we wrap up? Because I know that they're for sure it could be part two. Sure. I mean, there's a lot more questions that I have, but I definitely think we'll definitely have more conversations like this. And I'll just say if you're watching this and you're like, Terry is wrong, Chris is wrong, Caleb's wrong. Comment. I'm not saying that I don't have a share and we want more conversations. That's one thing I'm committed to is more conversations versus less. And so we want to hear from you. And if you want to come on and have a conversation, let us know. And we will make that happen. Any final words that you guys have as a relationship? Yeah. I'll just say you invited me here to talk about this. And it's not. I talk a lot. I don't ever talk about this. So I welcome to the world. I did not want this to be IOL versus whole life. Yeah. It's IOL. It's whole life and IOL, depending on the case, right? So it's looking objectively in what direction. No. We'll put that as a title with Chris's face, which is like this whole life and IOL. It's an end. No. No. Talk into the microphone. Yeah. I could just respectfully disagree. I will say out of all the IOL agents I've ever talked to, I have more respect for you than any of them because of the way you do it, because of the way you're managing it, whatever. I just really think it comes down to the fact that the nature in which you basically what you're saying is you're saying the life insurance company has given me this chassis that I can play with as a manager of it as the advisor of it. And you think you're going to manage that better than the general fund managers of the multi-pillion dollar company. That's what you're saying. It's effectively what it is. No. Because otherwise the whole life long term, you know, yeah. I mean, I was talking to Tom Waller. What is there to manage though? What is there to manage? What index do you want to participate in? Are you going to shift it to the, is it the S&P 500? Yeah. 12-month point to point. And I opinion all the other ones are smoking mirroring. Oh, they are. They agree on that. So it's that. And if, if, if, as an investment firm, if we see the economy where the market may be really down the next couple of years, we might move it into the fixed account. That's, it's, it's real, it's easier than managing a bond portfolio. I mean, to that argument, why would I? I have an investment firm as well. Well, maybe I wouldn't, but this is where we've been called to help and to serve. So it's kind of baked into what we do as a firm. So I just, I'm at the end of the day, I think for me, it just comes down to those like, I don't want to ever take risk in the life insurance contract. And it is a life insurance contract, not a policy. It's a contract. And contractually in a whole life policy, all the risk is on the insurance company to meet the obligations for me, the policy holder. When I put money into a, into an IUL, the risk is then shifted to the policy holder from the insurance company, fundamentally speaking. We can agree on that. There's, there's all these moving parts. There's all these moving parts inside of the policy. And, and, and I don't think insurance companies will shift those parts because they have to or because they, because they want to, I think they'll do it because they have to, based on the different economic things that are happening. And when, when push comes to shove, if they have guarantees, they have to meet for their mutual policy holders in the whole life policies. And then they look at the IUL and they go, you know, the push comes to shove. It's been proven with a lot of this way that they handled UL policies and granted there's other factors that play that, you know, with lowering interest rate environments and all these things that came into that. But I'm a big believer that when somebody tells you who they are, you got to believe them. And there's a history of bad track records with universal life chassis products. And they've tried to do a lot of different things to make them look good. And I think, I mean, don't get me wrong. We've sold a couple IULs and we're selling some IULs now, but they're not. I know. I know what. That's going in the hook. Right. So, but here's the deal. It's not for never for income, never for cash value. Always for the guaranteed death benefit rider. So it's like a legacy play that says, it's basically like a GUL. But on a little bit more of a flexible chassis with you being of the say, we're going to guarantee it until 96 years old or 105 years older, whatever it is. And it's a permaturn play is really what it is. And that to me is the benefit of IUL, like having the ability to do that outside of that, utilizing it for any kind of tax for income. Let me ask you this. This is one question I didn't ask. I'm sorry. When you do loans in retirement for the buffer strategy or for income, whether it's a stream or whatever, are you using the index to fix loans? We can use both depending on the environment, but generally I would use the index loan based on research we've done. Okay. So, you're not at all concerned with the fact that that loan compounds against you and then on down years that adds a lot of expense and cost to the policy. Again, we can change the loan and we can get a guaranteed wash loan if we need to, which is fixed in zero. It's a wash in the current environment and the research we've done. This is a deeper subject. But with the research we've done, we have confidence in using the index loans. But you would also agree. I feel like an attorney. You would also agree that. Because here's where I'm at. A whole life company. A whole life company can do the same thing. If we're in an environment, if we're in an environment where that's a risk, there's a 100% the whole life company doesn't have to pay the dividend. But it's not what I'm talking about. That's not the risk. You said that. No, no, no. You said it's a contract. Whole life is contractually guaranteed. It's not contractually guaranteed. It is a contract. Sure. There are guaranteed lovers, Max and men. Most agents don't know how to read that. In an IO contract, I know what the guaranteed Max and men where they can pull that lever. Whole life has those same levers that the company can pull. A whole life company doesn't have to pay the dividend. But that's not the conversation. The conversation is saying, if you had a million dollars outstanding loans and you have a 5% index loan, that's a cost that's going to be there. If you don't, it at least earn 5% in that policy to break even and earn the equivalent loan credits, that's going to be an additional cost and fee inside of that policy. Of course it is. The same is true with whole life. Yeah, but the difference with whole life is this is very flat. That's very measurable with IUL if a zero percent year adds 5% charge. The fixed account is not a zero percent. Yeah, but you're not going, you don't get to choose fixed after the year market does zero for the year. So you don't get to swap it. So it's active. So here's a real story. We have a client with four million dollars in loans out between two mutual whole life companies. The one whole life company, which is one of the top five actually, he is paying 4%. Because it's an old contract and the mutual company couldn't on the right thing, but they did because it's an old contract design, right? Where if it was an IUL contract, I can guarantee it's a zero wash. If you do it ahead of time, but I'm saying it's either or, but if you do that in an IUL, what you do, if you do that in an IUL and you choose a wash loan, you're not eating into the net amount of risk. So the annual renewable term is going to remain higher, which means every year your annual cost of insurance is going to go up. No, because we can control that. If you're like, so we would you agree that by the time the contract is finally getting heated, by the time the contract goes into where there's going to be loans, we've controlled those costs. But so would you agree that I can do it a whole life contract. Remember, I can't do that all I've got. Would you agree then that that your level of management and the complexity of your management, it goes infinitely through the rules when it gets to a retirement? It's not that complex. Actually, it's one phone call and five minutes to set it and it's done and never have to worry about it again. Yeah. For example, a whole life contract, I have a million dollars cash value. I have to have it reduced. This is hypothetical. We're pretty close. Two million dollars net amount at risk. Sure. Why it takes a loan at a whole life contract? There's a million dollars of cost of insurance coming out of that contract and the company can pull that lever to reduce dividend. Or within IUL contract, I have about a 300,000 dollar net amount at risk. I can bring it down from one million, from two million down to about 1.3. That's far less risky. If a million dollar loan is out, it's a very small amount at risk where that cost is coming out. We're a whole life. It's a much higher cost. That's not fair because the, no, it's absolutely not because with whole life, the cost of the insurance is more leveled off throughout the policy. So the risk when you get the risk when you get later because you've more paid earlier and it is more expensive earlier. That's not fair. It is absolutely fair because more telly is mortality. What's the more? If there's a mortality cost for the whole life. No, hold on. No, no, no, no, no. If there's a mortality cost, let's say we do a million dollars of insurance with whole life and a million dollars of insurance within I UL. Fair enough. The mortality costs throughout the lifetime expectancy of me or you is going to be, let whatever it is, say, $10,000, $100,000. I don't care what the number is. If the mortality cost is a mortality cost on those policies over the lifetime of the policy, they're going to be what they're going to be with whole life. Those fees are paid earlier in the, absolutely. With I UL, what's the annual renewable term? You have $300,000 of net amount at risk in an I UL at 85 years old and 300,000 in net amount at risk in the whole life. The cost of the I UL are higher. No. Yes. Yes. You can't know the answer to this. This is not a set up. What's the cost per thousand for a 65 year old? What is it for a 75 year old? It just depends on a company. Right. But the number is on a rate sheet somewhere. The company, I mean, actually... But it changes per product. Well, it changes per product. If mortality was at mortality, then every life insurance coming from the end of the business. Every life insurance company would let me finish. Every life insurance company would be about a business. The cost per thousand for a 75, 85, 90 year old or 35 year old is fixed based on the underwriting and the experience of that company. That cost is amortized into a whole life contract throughout the life of the contract, and it is within Iowa contract as well. So you're telling me that companies don't change the cost per 1,000 based on different products at all ever? Of course they do. Okay, so the cost per 1,000... No, no, no. That's not... That's not could spike later in life. No, I'm saying that... The whole life wouldn't. I'm saying that the cost per 1,000 of annual renewable term at 85 years old is more than the cost per 1,000. See, that used to be my argument, but it's not... No, it is absolutely the case. It's not exactly the same as annual renewable term, because annual renewable term does not have cash value to offset that. It does not reduce that amount at risk. It just keeps going up. That's not how you have nothing to do with it. The cash value... Wait, wait, wait, wait. The cash value... Are you telling me five a million dollar term policy with no cash right at 65? That's not the same amount. What is it? 800,000 in cash right? There's no difference. If you have a 1.5 million dollar death benefit and a million dollars in cash, the net amount at risk is the $500,000. That's the number that is the annual renewable term cost. That effectively, that is where the charge comes in. Of course. That's the risk. The cost is whatever that cost is for that company. Right. Based on the annual renewable term schedule of their age. Right. And it's the same for whole life. No. Sure it is. No. It has to be, or the insurance company's got a business... It's no. If the insurance company didn't price the whole life contract accordingly, they'd think of a... They do, but they charge more up front. That is the point. It's going to be more expensive earlier. That's why IEWLs can do what they do, because their annual renewable term is cheaper for a year. Why is a whole life insurance contract cheaper earlier? Why? It's cheaper earlier. It's not cheaper. Why is there lower... There's just no surrender charges. Wait. Why? I'm a spoke. Let me read, can't that. Why do you think a whole life insurance contract has more expense early and less later? Why? Risk. Explain that. The insurance company. Like... Then that amount at risk. Sure. And so the insurance company is... It's... It's... It's... It's... It's... It's... They're saying our mortality expense for this policy throughout the lifetime of the policy is going to be X. And so we're going to have you cover the fees and it's going to be a more level expense... On the mortality expenses, whereas the mortality expenses are lower. If we went over a 50 year period in both, let's just say in a vacuum, they're both the same. IEWL is going to be cheaper earlier than whole life. And it's going to be more expensive later. By the time we get to year 50, let's say they both, we had the total same mortality charges out of both. But the difference is this is where I had a huge problem with IEWL is because of the fact that when we get to retirement, I don't care what the policy does for me right now. If I need it to be dependable for me later in life, which is what we're talking about, I want the cost and the variables to be controlled. Control is one of the most important things. And IEWL, that variable of control is something that you don't have. Actually, you don't. So actually, we do have that control of the IEWL. You don't with whole life. You're going to try to tell me you could shrink more. Hold on. No, wait, let's go back to this. So a whole life... Here's the difference. You're not being fair with IEWL because IEWL has a bit... You're assuming it's minimally funded. So yeah, okay. That's a assuming ending. So would you agree that a whole life premium for a million dollars on a 45 year old, a premium required for that contract is much more expensive than the minimal premium on an IEWL contract? Of course. Okay. So for the listeners out there, what I'm saying is a whole... Let's say hypothetically, a whole life contract, the premium is 20 grand. For an IEWL contract, same death benefit, same person, they can put 20,000 into it or they could put maybe 6,000 in the minimal, right? So if we're funding it at 6,000, 6,000... You're also assuming that you're trying to use that base whole life. Well, actually, it doesn't matter. It's 100% matter. Let's say it's a paid up of 65, which is already designed to be paid up. But I would still not do 100%. Hey guys, so we had some technical difficulties there at the end. I'm not sure how much of the interview you're going to see. We were about to land the plane. We're all like, kumbaya. And then something you said, shocker, the crazy eyes came out. And there was probably like a 10 minute at each other's throat going back and forth. And I was like, this is amazing. I can't wait to use this for a hook. You literally said, Chris, you were like, I have a fan of IULs or I've used the IULs. I'm like, that's going in the hook. And you're like, all these things were... And then I looked over the camera and it was dark. And we must ran out of memory. So here's what I'm going to say is we're obviously going to get version one no matter what this looks like. And then all of us are committed to either doing something virtually or another conversation in person. So I just want to thank you. Please subscribe to our show. And also, like if you have thoughts, comments, if you have points, please put that in the comments. We're going to read all of them. And in part two, we're going to bring those to our conversation. Thank you.