A neglected opportunity
Article Abstract:
Stock brokers and insurance firms have jointly begun marketing single premium variable life investment (SPVLI) packages to consumers. Because SPVLI are not taxable (the investment is treated as an insurance policy that is accruing value, and the withdrawal is exempt as a policy loan), they generally make better investments than certificates of deposit, credit union accounts and money market funds. Investors considering an SPVLI should be aware that: money invested will be unobtainable for at least a two-year period; insurance will have to be paid for as part of the investment; withdrawals cost investors three-fourths of 1 percent of the amount withdrawn; people 75 years old and older are usually prohibited from investing in SPVLIs; the investment will cost seven-tenths of 1 percent per year; and withdrawals are limited to 75 percent of investments for the first three years, increasing to 90 percent inthe fourth year and following years.
Publication Name: Management Solutions
Subject: Human resources and labor relations
ISSN: 0889-0226
Year: 1986
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The ultimate savings account
Article Abstract:
Single premium whole life (SPWL) insurance plans earn interest at 7.5 percent annually, and since there is no tax on this interest, the rate of return is better than those offered on certificates of deposit (which average 6.5 percent annually and are taxable) or on one-year tax-free bond investments. A minimum investment of $5,000 is required by SPWLs, and the instruments are semi-liquid, since 92 percent of the original investment can be withdrawn at an interest rate of 1.8 percent of the withdrawal amount. Monthly interest accruals can be withdrawn without paying tax, but the minimum withdrawal amount is $500. Finally, because the investment is structured as an insurance policy, there are no probate or inheritance taxes payable upon the death of the SPWL owner.
Publication Name: Management Solutions
Subject: Human resources and labor relations
ISSN: 0889-0226
Year: 1987
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'Fallen angel' funds provide positive investment vehicle
Article Abstract:
The advantages of 'fallen angel' funds as investment vehicles for institutional investors are described. Fallen angel funds or recovery investing pertains to making active equity-oriented investments in undervalued firms suffering from financial difficulties which can be rectified for a short period and then resold at prices yielding yearly returns of 35% or more.
Publication Name: Pension World
Subject: Human resources and labor relations
ISSN: 0098-1753
Year: 1993
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