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VUL sim­ply stands for Vari­able Uni­ver­sal Life. Last week I wrote a quick overview of how it works and you can find it here: How and Where To Invest Your Mon­ey

But the ques­tion is — should I invest my mon­ey in it?

We have friends, col­leagues, and even rel­a­tives who are finan­cial advi­sors offer­ing this kind of invest­ment.

Some finan­cial men­tors rec­om­mend it. But how do I know if this is the right invest­ment for me?

I said before that I was once a Licensed Finan­cial Advi­sor. In fact, if by chance you’ve met a good finan­cial advi­sor; you’re in good hands!

On the oth­er hand, oth­ers will trick you to put your mon­ey on it with­out inform­ing you what are the advan­tages and dis­ad­van­tages of this invest­ment.

I also shared before that I stopped pay­ing my VUL and with­drawn all the remain­ing accu­mu­lat­ed cash val­ue it has because I felt it was­n’t aligned with my goals.I think that I got tricked because when the time came that I asked if I could add an add-on for it (crit­i­cal ill­ness, dis­abil­i­ty, etc,) he asked me instead to buy a new pol­i­cy.

And I don’t like to buy a new pol­i­cy because I have oth­er invest­ment in mind that I would like to put my mon­ey in it.

That start­ed my jour­ney in increas­ing my finan­cial knowl­edge and even­tu­al­ly led me to anoth­er invest­ment strat­e­gy that fits me well — BTID (Buy Term Insur­ance, Invest the Dif­fer­ence).

But which should I choose? VUL or BTID?

Today I have a close friend of mine who is also a Licensed Finan­cial Advi­sor wrote some­thing about it.


Which is better: BTID or VUL?

By Jennifer Yang-Estil, Licensed Financial Adviser / Co-Founder of Beyond Building Wealth


First things, first. What are BTID and VUL?

Let’s get famil­iar with the terms first.

BTID is the acronym of Buy Term Invest The Dif­fer­ence. It’s a finan­cial strat­e­gy that uses the con­cept of buy­ing a Tra­di­tion­al Term Life Insur­ance and then invest­ing the rest of your cash flow or bud­get in a sep­a­rate invest­ment product/vehicle.

VUL is the acronym of Vari­able Uni­ver­sal Life Insur­ance. VUL is a non-tra­di­tion­al life insur­ance prod­uct where­in it com­bines life insur­ance with mutu­al funds (a type of
invest­ment product/vehicle).

It’s The Wrong Question

Going back to my point: the ques­tion whether “which from BTID or VUL is bet­ter” is wrong.

Why? Because BTID and VUL are both strate­gies that solve spe­cif­ic prob­lems.

It’s the same as ask­ing which is the bet­ter fruit, apples or oranges? Both fruits are great, but it’s your pref­er­ence and pur­pose that’ll deter­mine which is bet­ter for you. Like if you’re mak­ing apple strudels for your family’s dessert, then using oranges would be a bad idea,

Sim­i­lar­ly ask­ing is whether which is the bet­ter med­i­cine between Parac­eta­mol or Guaife­n­esin.

With this anal­o­gy in mind, nei­ther which is the bet­ter med­i­cine between Parac­eta­mol and Guaife­n­esin. Both are effec­tive as med­i­cines, but with dif­fer­ent pur­pos­es. Parac­eta­mol treats fevers and pains, while as Guaife­n­esin treats coughs and used as an expec­to­rant.

It’s the same with BTID and VUL.


Asking The Right Question

Now, the right ques­tion to ask is: What’s the best finan­cial solu­tion for my needs and goals?

Your finan­cial needs and goals will then deter­mine what finan­cial strate­gies and solu­tions are best for you. And based on my expe­ri­ence, it is nev­er the exact same solu­tion and strat­e­gy for every­one.

Finan­cial solu­tions should indi­vid­u­al­ize, cus­tomize and spe­cif­ic based on what the per­son needs and based on what the finan­cial assess­ment reveals. It is very sim­i­lar to what physician’s do to their patients.

So to answer the right ques­tion, get in touch with your trust­ed finan­cial advis­er and have a com­plete finan­cial assess­ment from them.

Your finan­cial advis­er should give you rec­om­men­da­tions depend­ing on what will be the result of your assess­ment and then work with you in build­ing your finan­cial plan and in achiev­ing your mile­stones.

I’m say­ing this because not all finan­cial advis­ers are client-cen­tric but instead sales-cen­tric. They play the sales agent role instead of the finan­cial advis­ers’ role in guid­ing clients achiev­ing break­throughs and meet­ing the client’s needs.

As a Finan­cial Advis­er, I make it to a point that I make a com­plete Finan­cial Assess­ment to every client that comes my way, and I also take into con­sid­er­a­tion their pref­er­ences, bud­get, and per­son­al­i­ty as an investor and as an indi­vid­ual before mak­ing any finan­cial solu­tions and rec­om­men­da­tions.


Characteristics of BTID and VUL

Now that we’re all on the same page, let’s look at the char­ac­ter­is­tics and spec­i­fi­ca­tions of BTID and VUL. Here’s a list for you to bet­ter grasp the sim­i­lar­i­ty and dif­fer­ence between the two.


Char­ac­ter­is­tics BTID VUL
Cost of Insur­ance Low-cost tra­di­tion­al term insur­ance pre­mi­um on the onset of appli­ca­tion.  Term insur­ance pre­mi­ums increase in cost every 5 years High­er cost of VUL insur­ance pre­mi­um on the onset of appli­ca­tion since insur­ance and invest­ments are com­bined VUL pre­mi­ums are con­stant and do not change from
the onset of appli­ca­tion
Dura­tion of Pro­tec­tion Short term pro­tec­tion of 5 years or 1 year (varies from insur­ance com­pa­nies) Long-term pro­tec­tion until age 88 or 100 (varies from insur­ance com­pa­nies)
Renewa­bil­i­ty Needs to be renewed every 5 years or annu­al­ly (varies from insur­ance com­pa­nies) No need to renew VUL pol­i­cy is on-going from
approval of pol­i­cy until matu­ri­ty age or until
pre­mi­ums are still paid.
Insur­a­bil­i­ty Protection/insurability is not guar­an­teed with Term Insur­ance since there are instances that your insur­ance com­pa­ny will require you to
under­go a med­ical exam once the renew­al peri­od of 5 years or 1 year is over.You may be denied insur­ance pro­tec­tion if you’re declared med­ical­ly unfit, or a much
high­er pre­mi­um will be charged to your term
insur­ance based on the med­ical results.
Protection/insurability is guar­an­teed until the stat­ed age on your VUL insur­ance con­tact.
Con­ve­nience You can pay Insur­ance pre­mi­ums can via auto deb­it and bills pay­ment online.

Invest­ments are sep­a­rate and there are no bills noti­fi­ca­tion for you to add to your

You need to man­u­al­ly add/deposit to your invest­ments for you to invest reg­u­lar­ly.

Insur­ance and invest­ments are linked togeth­er thus both are paid and invest­ed to reg­u­lar­ly (via auto deb­it and bills pay­ment online) in just
one account.
Acces­si­bil­i­ty Insur­ance can be mon­i­tored and checked reg­u­lar­ly online (varies from insur­ance
com­pa­nies). Invest­ments are mon­i­tor sep­a­rate­ly via online or offline since it is a dif­fer­ent prod­uct.
Insur­ance and invest­ments can be both mon­i­tor at the same online por­tal (varies from insur­ance com­pa­nies)-

Finan­cial Advis­ers can reg­u­lar­ly mon­i­tor and
man­age your invest­ments for you and noti­fy you of due dates, mar­ket updates and
oth­er prod­uct relat­ed needs.

Com­mit­ment & Dis­ci­pline
High com­mit­ment and dis­ci­pline need­ed since you’ll han­dle and man­age your
invest­ments manually.No one will remind you of your due dates, insur­ance expi­ra­tions dates nor give you mar­ket updates. It’s your mon­ey any­way, you have the total con­trol of it.
High com­mit­ment but low dis­ci­pline since your Finan­cial Advis­er will man­age your pol­i­cy and port­fo­lio for you.

Your Finan­cial Advis­er will remind you and noti­fy you of your pol­i­cy due dates and
invest­ment updates as need­ed.

Fit Finan­cial Needs Short term insur­ance pro­tec­tion.
Man­u­al man­ag­ing of invest­ments.
Long-term insur­ance pro­tec­tion.

Clien­tele expe­ri­ence with your Finan­cial Advis­er han­dling your account and

Fit to Per­son­al­i­ty Type Dis­ci­plined and com­mit­ted with a strong habit of sav­ing and invest­ing reg­u­lar­ly New­bies and are just get­ting the habit of sav­ing and invest­ing

Is BTID or VUL bet­ter for me?

Now, that’s a bet­ter ques­tion. And all I can say is, it depends. Let’s talk about it and let me assess you finan­cial­ly to see which is bet­ter for you to achieve your finan­cial mile­stones, goals, and needs.

For now, you can list your finan­cial goals and needs to get you start­ed. Click here to get start­ed with your goals.

Either way, whichev­er you choose BTID or VUL is great. As long as you START NOW!

What’s most impor­tant is that you start in build­ing your wealth, pro­tec­tion and roadmap as ear­ly as today, because in the long run your future self and your fam­i­ly will thank you for it.


Now to answer the question: Should I Invest in VUL?


It’s me again — Dhenn. My answer: It depends. For me, BTID works best, for oth­ers VUL works best. In my own per­son­al expe­ri­ence and opin­ion, you will only buy VUL if you fall into these type of per­son:

1. You’re “too lazy” to look for bet­ter invest­ments or you are a new­bie.
2. You already have enough funds and stock invest­ments and look­ing for sec­ondary invest­ment to pro­tect those assets.
3. You want to help a friend who’s sell­ing you that type of insur­ance.

Over­all, one of the many rea­sons why I did not con­tin­ue my VUL pol­i­cy is this:

1. I want total con­trol over my invest­ments.
2. I learned that the first three years of the pol­i­cy (depends on the com­pa­ny), most pay­ments will go to insur­ance first and a small frac­tion of the invest­ment which is rea­son­able as you also bought an insur­ance.
3. BTID just works best for me now.

By the way, Jen is offer­ing free coach­ing and Finan­cial Blue­print Ses­sion so you can bet­ter rec­om­mend the right finan­cial strat­e­gy and prod­uct for you. Con­tact Jen below for an appoint­ment if you want to avail the VUL.

[email protected]
[email protected]

+63 916 349 3172

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I blog about my dis­cov­er­ies and learn­ings with per­son­al devel­op­ment, blog­ging, writ­ing, pub­lic speak­ing, and pub­lish­ing. I am a Jesus fol­low­er. Each month, I send out a newslet­ter with free tips on those top­ics.

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