Is this really possible? Mutual funds vs Whole life insurance?

Question by ratmforever: Is this really possible? Mutual funds vs Whole life insurance?
I understand that the investment linked with whole life offers very little returns compared to real investments like mutual funds. Now I tried this online compound calculator http://www.math.com/students/calculators/source/compound.htm to see if mutual funds can really beat insurance “investments”.

I placed the following data in the calculator:
Years: 40
Percent Yield: 12%
Initial Balance: $ 500
Monthly Contribution: $ 100
Final Balance: $ 1,235,801.11

Is this data realistic in mutual funds? If so then it sure beats what whole life insurance offers and that the saying “Buy term invest the difference” is really true. So are these realistic figures or something wrong with the calculator ­čÖé ?

Best answer:

Answer by molly b
Whole life and mutual funds are two different breeds. Whole life insurance cannot earn more cash value than the death benefit unless you are doing Universal Life. If it does than you get hit with penalties. Mutual Funds can earn and lose money. There are no guarantees above simple interest. Whole life insurance will not lose it’s cash value, but will not gain as much either. Look also into annuities. They can be single premium immediate to monthly pay with several payout options. They are more stable than mutual funds and can earn a very nice return on the investment.

Know better? Leave your own answer in the comments!

Wow…..T_T (I DO NOT OWN THE RIGHTS TO THIS CONTENT)
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18 comments to Is this really possible? Mutual funds vs Whole life insurance?

  • sunrisejack

    INSURANCE SHOULD NOT BE AN INVESTMENT AS A RULE INSURANCE IS A RISK SHARING AGREEMENT
    BUY TERM AND INVEST THE DIFFERENCE WORKS

  • Swaminathan P

    If you wanted risk cover on life – insurance (be prime factor) then go for Insurance alone
    if you want better return without risk cover, go for mutual funds
    there are products offer you both – then don’t look at return.
    you cannot have cake and eat it too.

  • $so fresh so clean$

    Whole life insurance is one of the worst investments there is. You’re basically paying more than you have to for life insurance. When you go with term life insurance, you’re getting the pure insurance without the big commissions agents would get with whole life, or as they call it “permanent.” There’s a reason why they push whole life on people, commissions. You take the rest and put into a mutual fund aside from an insurance company. Go with a no-load, low cost mutual fund.

  • muncie birder

    no it is not too realistic. 8-10% is about what you might actually expect. Call it 9%. $ 486,000.

  • bubba

    The calculator is correct. I will copy and paste the returns.

    As for the rest of your question: 12% is a bit hight. To be conservative use a 9% or 10% return. Also realize that this does not take into account the affects of inflation.
    Initial Deposit: $ 500.00
    Interest Rate: 12.00%
    Monthly Contribution: $ 100.00

    2,008 Feb $ 500.00
    2,008 March $ 606.00
    2,008 April $ 713.06
    2,008 May $ 821.19
    2,008 June $ 930.40
    2,008 July $ 1,040.71
    2,008 Aug $ 1,152.11
    2,008 Sept $ 1,264.63
    2,008 Oct $ 1,378.28
    2,008 Nov $ 1,493.06
    2,008 Dec $ 1,608.99
    2,009 Jan $ 1,726.08
    2,009 Feb $ 1,844.35
    2,009 March $ 1,963.79
    2,009 April $ 2,084.43
    2,009 May $ 2,206.27
    2,009 June $ 2,329.33
    2,009 July $ 2,453.63
    2,009 Aug $ 2,579.16
    2,009 Sept $ 2,705.95
    2,009 Oct $ 2,834.01
    2,009 Nov $ 2,963.35
    2,009 Dec $ 3,093.99
    2,010 Jan $ 3,225.93
    2,010 Feb $ 3,359.19
    2,010 March $ 3,493.78
    2,010 April $ 3,629.72
    2,010 May $ 3,767.01
    2,010 June $ 3,905.68
    2,010 July $ 4,045.74
    2,010 Aug $ 4,187.20
    2,010 Sept $ 4,330.07
    2,010 Oct $ 4,474.37
    2,010 Nov $ 4,620.11
    2,010 Dec $ 4,767.32
    2,011 Jan $ 4,915.99
    2,011 Feb $ 5,066.15
    2,011 March $ 5,217.81
    2,011 April $ 5,370.99
    2,011 May $ 5,525.70
    2,011 June $ 5,681.96
    2,011 July $ 5,839.78
    2,011 Aug $ 5,999.17
    2,011 Sept $ 6,160.16
    2,011 Oct $ 6,322.77
    2,011 Nov $ 6,486.99
    2,011 Dec $ 6,652.86
    2,012 Jan $ 6,820.39
    2,012 Feb $ 6,989.60
    2,012 March $ 7,160.49
    2,012 April $ 7,333.10
    2,012 May $ 7,507.43
    2,012 June $ 7,683.50
    2,012 July $ 7,861.34
    2,012 Aug $ 8,040.95
    2,012 Sept $ 8,222.36
    2,012 Oct $ 8,405.58
    2,012 Nov $ 8,590.64
    2,012 Dec $ 8,777.55
    2,013 Jan $ 8,966.32
    2,013 Feb $ 9,156.99
    2,013 March $ 9,349.55
    2,013 April $ 9,544.05
    2,013 May $ 9,740.49
    2,013 June $ 9,938.90
    2,013 July $ 10,139.28
    2,013 Aug $ 10,341.68
    2,013 Sept $ 10,546.09
    2,013 Oct $ 10,752.56
    2,013 Nov $ 10,961.08
    2,013 Dec $ 11,171.69
    2,014 Jan $ 11,384.41
    2,014 Feb $ 11,599.25
    2,014 March $ 11,816.25
    2,014 April $ 12,035.41
    2,014 May $ 12,256.76
    2,014 June $ 12,480.33
    2,014 July $ 12,706.13
    2,014 Aug $ 12,934.19
    2,014 Sept $ 13,164.54
    2,014 Oct $ 13,397.18
    2,014 Nov $ 13,632.15
    2,014 Dec $ 13,869.47
    2,015 Jan $ 14,109.17
    2,015 Feb $ 14,351.26
    2,015 March $ 14,595.77
    2,015 April $ 14,842.73
    2,015 May $ 15,092.16
    2,015 June $ 15,344.08
    2,015 July $ 15,598.52
    2,015 Aug $ 15,855.51
    2,015 Sept $ 16,115.06
    2,015 Oct $ 16,377.21
    2,015 Nov $ 16,641.98
    2,015 Dec $ 16,909.40
    2,016 Jan $ 17,179.50
    2,016 Feb $ 17,452.29
    2,016 March $ 17,727.82
    2,016 April $ 18,006.09
    2,016 May $ 18,287.16
    2,016 June $ 18,571.03
    2,016 July $ 18,857.74
    2,016 Aug $ 19,147.31
    2,016 Sept $ 19,439.79
    2,016 Oct $ 19,735.19
    2,016 Nov $ 20,033.54
    2,016 Dec $ 20,334.87
    2,017 Jan $ 20,639.22
    2,017 Feb $ 20,946.61
    2,017 March $ 21,257.08
    2,017 April $ 21,570.65
    2,017 May $ 21,887.36
    2,017 June $ 22,207.23
    2,017 July $ 22,530.30
    2,017 Aug $ 22,856.61
    2,017 Sept $ 23,186.17
    2,017 Oct $ 23,519.03
    2,017 Nov $ 23,855.22
    2,017 Dec $ 24,194.78
    2,018 Jan $ 24,537.72
    2,018 Feb $ 24,884.10
    2,018 March $ 25,233.94
    2,018 April $ 25,587.28
    2,018 May $ 25,944.15
    2,018 June $ 26,304.60
    2,018 July $ 26,668.64
    2,018 Aug $ 27,036.33
    2,018 Sept $ 27,407.69
    2,018 Oct $ 27,782.77
    2,018 Nov $ 28,161.60
    2,018 Dec $ 28,544.21
    2,019 Jan $ 28,930.65
    2,019 Feb $ 29,320.96
    2,019 March $ 29,715.17
    2,019 April $ 30,113.32
    2,019 May $ 30,515.46
    2,019 June $ 30,921.61
    2,019 July $ 31,331.83
    2,019 Aug $ 31,746.14
    2,019 Sept $ 32,164.61
    2,019 Oct $ 32,587.25
    2,019 Nov $ 33,014.12
    2,019 Dec $ 33,445.27
    2,020 Jan $ 33,880.72
    2,020 Feb $ 34,320.53
    2,020 March $ 34,764.73
    2,020 April $ 35,213.38
    2,020 May $ 35,666.51
    2,020 June $ 36,124.18
    2,020 July $ 36,586.42
    2,020 Aug $ 37,053.28
    2,020 Sept $ 37,524.82
    2,020 Oct $ 38,001.06
    2,020 Nov $ 38,482.07
    2,020 Dec $ 38,967.90
    2,021 Jan $ 39,458.57
    2,021 Feb $ 39,954.16
    2,021 March $ 40,454.70
    2,021 April $ 40,960.25
    2,021 May $ 41,470.85
    2,021 June $ 41,986.56
    2,021 July $ 42,507.42
    2,021 Aug $ 43,033.50
    2,021 Sept $ 43,564.83
    2,021 Oct $ 44,101.48
    2,021 Nov $ 44,643.50
    2,021 Dec $ 45,190.93
    2,022 Jan $ 45,743.84
    2,022 Feb $ 46,302.28
    2,022 March $ 46,866.30
    2,022 April $ 47,435.97
    2,022 May $ 48,011.33
    2,022 June $ 48,592.44
    2,022 July $ 49,179.36
    2,022 Aug $ 49,772.16
    2,022 Sept $ 50,370.88
    2,022 Oct $ 50,975.59
    2,022 Nov $ 51,586.34
    2,022 Dec $ 52,203.21
    2,023 Jan $ 52,826.24
    2,023 Feb $ 53,455.50
    2,023 March $ 54,091.06
    2,023 April $ 54,732.97
    2,023 May $ 55,381.30
    2,023 June $ 56,036.11
    2,023 July $ 56,697.47
    2,023 Aug $ 57,365.44
    2,023 Sept $ 58,040.10
    2,023 Oct $ 58,721.50
    2,023 Nov $ 59,409.72
    2,023 Dec $ 60,104.81
    2,024 Jan $ 60,806.86
    2,024 Feb $ 61,515.93
    2,024 March $ 62,232.09
    2,024 April $ 62,955.41
    2,024 May $ 63,685.96
    2,024 June $ 64,423.82
    2,024 July $ 65,169.06
    2,024 Aug $ 65,921.75
    2,024 Sept $ 66,681.97
    2,024 Oct $ 67,449.79
    2,024 Nov $ 68,225.29
    2,024 Dec $ 69,008.54
    2,025 Jan $ 69,799.63
    2,025 Feb $ 70,598.62
    2,025 March $ 71,405.61
    2,025 April $ 72,220.66
    2,025 May $ 73,043.87
    2,025 June $ 73,875.31
    2,025 July $ 74,715.06
    2,025 Aug $ 75,563.21
    2,025 Sept $ 76,419.85
    2,025 Oct $ 77,285.04
    2,025 Nov $ 78,158.89
    2,025 Dec $ 79,041.48
    2,026 Jan $ 79,932.90
    2,026 Feb $ 80,833.23
    2,026 March $ 81,742.56
    2,026 April $ 82,660.98
    2,026 May $ 83,588.59
    2,026 June $ 84,525.48
    2,026 July $ 85,471.74
    2,026 Aug $ 86,427.45
    2,026 Sept $ 87,392.73
    2,026 Oct $ 88,367.65
    2,026 Nov $ 89,352.33
    2,026 Dec $ 90,346.85
    2,027 Jan $ 91,351.32
    2,027 Feb $ 92,365.84
    2,027 March $ 93,390.49
    2,027 April $ 94,425.40
    2,027 May $ 95,470.65
    2,027 June $ 96,526.36
    2,027 July $ 97,592.62
    2,027 Aug $ 98,669.55
    2,027 Sept $ 99,757.25
    2,027 Oct $ 100,855.82
    2,027 Nov $ 101,965.38
    2,027 Dec $ 103,086.03
    2,028 Jan $ 104,217.89
    2,028 Feb $ 105,361.07
    2,028 March $ 106,515.68
    2,028 April $ 107,681.84
    2,028 May $ 108,859.65
    2,028 June $ 110,049.25
    2,028 July $ 111,250.74
    2,028 Aug $ 112,464.25
    2,028 Sept $ 113,689.89
    2,028 Oct $ 114,927.79
    2,028 Nov $ 116,178.07
    2,028 Dec $ 117,440.85
    2,029 Jan $ 118,716.26
    2,029 Feb $ 120,004.42
    2,029 March $ 121,305.47
    2,029 April $ 122,619.52
    2,029 May $ 123,946.72
    2,029 June $ 125,287.18
    2,029 July $ 126,641.06
    2,029 Aug $ 128,008.47
    2,029 Sept $ 129,389.55
    2,029 Oct $ 130,784.45
    2,029 Nov $ 132,193.29
    2,029 Dec $ 133,616.22
    2,030 Jan $ 135,053.39
    2,030 Feb $ 136,504.92
    2,030 March $ 137,970.97
    2,030 April $ 139,451.68
    2,030 May $ 140,947.20
    2,030 June $ 142,457.67
    2,030 July $ 143,983.24
    2,030 Aug $ 145,524.08
    2,030 Sept $ 147,080.32
    2,030 Oct $ 148,652.12
    2,030 Nov $ 150,239.64
    2,030 Dec $ 151,843.04
    2,031 Jan $ 153,462.47
    2,031 Feb $ 155,098.09
    2,031 March $ 156,750.07
    2,031 April $ 158,418.57
    2,031 May $ 160,103.76
    2,031 June $ 161,805.80
    2,031 July $ 163,524.86
    2,031 Aug $ 165,261.10
    2,031 Sept $ 167,014.72
    2,031 Oct $ 168,785.86
    2,031 Nov $ 170,574.72
    2,031 Dec $ 172,381.47
    2,032 Jan $ 174,206.28
    2,032 Feb $ 176,049.35
    2,032 March $ 177,910.84
    2,032 April $ 179,790.95
    2,032 May $ 181,689.86
    2,032 June $ 183,607.76
    2,032 July $ 185,544.83
    2,032 Aug $ 187,501.28
    2,032 Sept $ 189,477.29
    2,032 Oct $ 191,473.07
    2,032 Nov $ 193,488.80
    2,032 Dec $ 195,524.69
    2,033 Jan $ 197,580.93
    2,033 Feb $ 199,657.74
    2,033 March $ 201,755.32
    2,033 April $ 203,873.87
    2,033 May $ 206,013.61
    2,033 June $ 208,174.75
    2,033 July $ 210,357.50
    2,033 Aug $ 212,562.07
    2,033 Sept $ 214,788.69
    2,033 Oct $ 217,037.58
    2,033 Nov $ 219,308.95
    2,033 Dec $ 221,603.04
    2,034 Jan $ 223,920.07
    2,034 Feb $ 226,260.27
    2,034 March $ 228,623.88
    2,034 April $ 231,011.12
    2,034 May $ 233,422.23
    2,034 June $ 235,857.45
    2,034 July $ 238,317.02
    2,034 Aug $ 240,801.19
    2,034 Sept $ 243,310.21
    2,034 Oct $ 245,844.31
    2,034 Nov $ 248,403.75
    2,034 Dec $ 250,988.79
    2,035 Jan $ 253,599.68
    2,035 Feb $ 256,236.67
    2,035 March $ 258,900.04
    2,035 April $ 261,590.04
    2,035 May $ 264,306.94
    2,035 June $ 267,051.01
    2,035 July $ 269,822.52
    2,035 Aug $ 272,621.75
    2,035 Sept $ 275,448.96
    2,035 O

  • InsanityLiquid

    Well´╗┐ that’s what you get for driving in the on-coming lane.

  • Dcmcfmc1428

    I cried´╗┐

  • KonnichiwaSushi

    Steering wheel on right side,so car would probably be left lane ´╗┐

  • dongdongco

    1 DISLIKE!?!?! WHATS WRONG WITH´╗┐ THIS WORLD

  • 4agyJenny

    OMg I’m crying…oh, i’m such a sook´╗┐

  • Kernage

    didn’t´╗┐ see that one comming at all

  • MrBigjoe437

    thats sad´╗┐

  • Abilitiiy

    @MomokoFaust that´╗┐ he laughed is his thought after the bus attacting.

  • jnastayy

    @JKOK6´╗┐ He ran out of TIME, man. Get it?

  • ayprel

    @Lilly02Roblox It’s not. He is.
    Look at the yellow line dividing the lanes. The bus is on the correct side of it.
    They drive on the right side of the car, and we drive on´╗┐ the left.

  • JKOK6

    How the hell did his watch´╗┐ just spontaneously blew up like that?

  • VividnessProductions

    @Lilly02Roblox ITS A´╗┐ FAIL BUS!111
    BUT THAT MAKES IT MORE SADDER

  • Lilly02Roblox

    This is´╗┐ so sad but WHY IS THE BUS DRIVING ON THE WRONG SIDE OF THE ROAD? LOL

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