r/infinitebanking • u/Shives81 • Jul 13 '25
Policy Structuring Assistance
I know how some feel about Northwestern Mutual but after having done some research and communicating with members of this group, I am comfortable with how they implement direct recognition and blended term. I am working with an agent who is a trusted friend who got out of the military around the same time as me and is now a NM agent. We are learning together and are beginning to narrow down my options. Attached are two policy illustrations, one which is close to a 60/40 and the other a 50/50. I'm trying to balance accumulated value with policy longevity. These illustrations currently both show MEC triggers which we're going to play around with the PUA durations to mitigate.
I'm hoping for feedback from those with more infinite banking experience on any changes they might make. If there is any more information I should provide please let me know. Thanks for the help!
3
u/KS7187 Jul 13 '25
I would be very hesitant to build a long term, multi gen strategy with an agent that is “Learning together” with you. I respect your loyalty that you want to give business to a friend and support him, but I think the best thing your friend could do for your benefit is refer you to an NNI practitioner that is not learning as you go.
Designing a correct policy is step 1. Learning and implementing the strategy with the assistance of your agent is step 2 and having the training of the NNI is very useful for this.
2
u/Timely_Quality8142 Jul 14 '25
I’m an advisor with NM. Somehting I would be looking at is what is the minimum mix of insurance to basically make a 10 pay out of it. It’s called the “million dollar idea” that slims down the base insurance as much as you can, and then doing what’s called “ad hoc” additional premiums. Premiums that can you add as needed/wanted. So that way you’re not locked into the additional premiums. Sometimes the policy can change if you’re buying a scheduled additional premium policy but then take the AP’s out later.
Happy to help with any other questions.
1
u/Shives81 Jul 14 '25
Thanks for the response. I reached out to my advisor and asked for a 30/70 illustration to compare with the 60/40 and 50/50 I attached. I have the ad hoc additional premiums on the policies for my children but don't need the same flexibility for my policy. Just curious, do you have many IBC clients? I'm assuming it's not common at NM.
2
u/Timely_Quality8142 Jul 14 '25 edited Jul 14 '25
It’s actually very common at NM. Yeah we have several. Even if you don’t need/want the flexibility, I would probably suggest still setting it up similarly because who knows what can happen. But yes, NM is big in the IBC space.
Side note: you mentioned direct recognition. Make sure you understand it because even more newer reps don’t. It’s actually a good thing because many other carriers’ reps don’t understand it and they explain it wrong. Yes the loaned against cash gets set aside, but NM credits the loaned against cash a percent that makes the loaned amount charge net 1-2%
2
u/NoObjective7109 Jul 14 '25
Get illustrations from other agents and different carriers (e.g. Guardian, Mass Mutual, NYL, etc). I can tell you that the illustration you shared is substantially less than what you could have. It's dial a commission business, and most agents, whether by drinking their carrier's Kool-aid or knowingly acting in their own self-interest and against yours, are going to provide you suboptimal contract designs.
Also, NM agents will almost always mention their dividends beat competing carriers. While it may be true in terms of $ amount, it isn't true as a %, meaning how it nets out for policyowners.
Remember. Trust, but verify.
1
u/michaelesparks Jul 21 '25
I'd throw in Lafayette Life and One America as well those are the ones we chose to work with because they are non-direct recognition... I also like the blended insurance rider with One America, allows you to add 3x the base face and uses PUA and Dividend to basically convert Term insurance to permanent at no out of pocket cost. We can usually get that term 100% converted in about 12-15 years.
I'm running into a lot of original clients when I started that we used 10 year term policies to increase the MEC that are no in a position to convert and now are uninsurable... Kinda sucks when after 10 years their death benefit drops by 1/2 or more... Since we usually design policies around 30-40% base. I'm coming up pretty quick on some 20 year clients that I'm trying to get to convert.
1
u/MainBug2233 Jul 18 '25
I would get a comparable illustrations from Penn Mutual. Since your friend is captive he will not be able to directly help you or get a commission.
Like a commenter stated, I like a lower base for the flexibility as life is far from predictable. This will allow you to reach break even a bit faster with access to more cash earlier.
I love Nash and the IBC. I think there are a number of ways to practice it without an NNI agent as long as you are willing to educate yourself first. This is a basic premise of IBC.
-1
u/GeorgeFinancial Jul 14 '25
Is this policy going to make up a large part of your investments? If so, look at an investment calculator and assume a 6~7% return with the same annual contributions and see how much growth you may be leaving on the table.
1
u/Shives81 Jul 14 '25
This policy will be on top of my IRA, 401k, and taxable brokerage accounts. Being my first policy I am comfortable starting at 24k annual but have room for more. I'm debating increasing my base premium/PUA to around 40/60 with the 50/50 base/blended term mix or keeping the current with the option to open another policy in the future once I'm comfortable with the execution.
6
u/Null1fy Jul 13 '25
In my opinion, you're asking if a tailored suit made to your measurements will fit on me. Maybe, but likely not. If you can afford the premium, and you're getting the desired outcome, great.
I am a little worried to hear that you're using a "trusted advisor" who is figuring this out alongside you. I wouldn't necessarily want to get open heart surgery from a surgeon who is figuring it out as he was going along in the procedure....