Search found 26 matches

by trixie449
Wed Feb 20, 2019 8:06 pm
Forum: Personal Consumer Issues
Topic: What is a lemon? 2018 Outback Infotainment issues
Replies: 33
Views: 16348

Re: What is a lemon? 2018 Outback Infotainment issues

Just chiming in as another person with this issue with the 2018 Outback. It’s not just the radio - the backup camera will freeze, Bluetooth repeatedly cuts in and out... so disappointed with this car. When I contacted the dealer a week after buying new, they said ‘Oh yeah, it’s a known problem, just turn the car off for 20 minutes to let it reset.’ Ugh. Anyone have success getting it fixed?
by trixie449
Wed Mar 07, 2018 12:56 pm
Forum: Personal Finance (Not Investing)
Topic: 10% IRS penalty on annuity that was 1035 exchange from VUL?
Replies: 20
Views: 1430

Re: 10% IRS penalty on annuity that was 1035 exchange from VUL?

Yup, Vanguard has 0 listed as the pre-tefra cost basis, and the post-tefra and total cost basis are the same value. Thanks for the help and education!
by trixie449
Tue Mar 06, 2018 11:10 pm
Forum: Personal Finance (Not Investing)
Topic: 10% IRS penalty on annuity that was 1035 exchange from VUL?
Replies: 20
Views: 1430

Re: 10% IRS penalty on annuity that was 1035 exchange from VUL?

FiveK wrote: Tue Mar 06, 2018 5:35 pm
When the 1035 exchange occurred, did you get a statement with "Cost Basis Information"?

Might have numbers for Pre-Tefra Capital, Pre-Tefra Gain, Post-Tefra Capital, and Post-Tefra Gain. If so, and assuming pre-Tefra amounts were $0, Vanguard should be using the "Post-Tefra Capital" (or whatever phrase the transferring company used) as your basis.
Well, though everyone has agreed with the cost basis, I am unfamiliar with the tefra terminology you are using.
by trixie449
Tue Mar 06, 2018 11:05 pm
Forum: Personal Investments
Topic: Keep or get out of Variable annuity? Hairy math.
Replies: 35
Views: 6717

Re: Keep or get out of Variable annuity? Hairy math.

Chuck wrote: Tue Mar 06, 2018 3:05 pm Today, I mentioned in another thread how I regret not surrendering my variable annuity when its value was below my cost basis.
I'm glad I got you thinking! :D
by trixie449
Tue Mar 06, 2018 3:19 pm
Forum: Personal Finance (Not Investing)
Topic: 10% IRS penalty on annuity that was 1035 exchange from VUL?
Replies: 20
Views: 1430

Re: 10% IRS penalty on annuity that was 1035 exchange from VUL?

Chuck wrote: Tue Mar 06, 2018 1:11 pm Based on what you've said, I think it would be better to just call a tax professional instead.
Yeah, my CPA said they weren't positive as this was funded with post-tax dollars and hadn't yet reached basis, didn't think I would be subject, but stated they didn't know who to refer me to for the definitive answer.
by trixie449
Tue Mar 06, 2018 3:16 pm
Forum: Personal Finance (Not Investing)
Topic: Do I really need umbrella insurance?
Replies: 21
Views: 2171

Re: Do I really need umbrella insurance?

If you are at a high risk of being sued, then yes I think it's worth it to protect your assets, given that you can afford the extra insurance payment. But that's just my opinion.
by trixie449
Tue Mar 06, 2018 12:20 pm
Forum: Personal Finance (Not Investing)
Topic: 10% IRS penalty on annuity that was 1035 exchange from VUL?
Replies: 20
Views: 1430

Re: 10% IRS penalty on annuity that was 1035 exchange from VUL?

Chuck wrote: Tue Mar 06, 2018 11:57 am In addition to what others have said, I'd like to add... DO IT!
Thanks Chuck! Wish I had dumped the VUL earlier, or better yet, never gotten it. But you are correct, being worried about a home for $130,000 is a great first world problem to have! :D
by trixie449
Tue Mar 06, 2018 11:47 am
Forum: Personal Finance (Not Investing)
Topic: 10% IRS penalty on annuity that was 1035 exchange from VUL?
Replies: 20
Views: 1430

Re: 10% IRS penalty on annuity that was 1035 exchange from VUL?

From the kiplinger link - "If you cash out a deferred annuity in a lump sum, then you'll have to pay income taxes on all of the earnings higher than your original investment. " So you also believe no earnings as still not back to basis, that earnings doesn't start until I have reached basis?

Thank you, too, FiveK - will read that one now.
by trixie449
Tue Mar 06, 2018 11:37 am
Forum: Personal Finance (Not Investing)
Topic: 10% IRS penalty on annuity that was 1035 exchange from VUL?
Replies: 20
Views: 1430

Re: 10% IRS penalty on annuity that was 1035 exchange from VUL?

HueyLD wrote: Tue Mar 06, 2018 11:32 am
If you have no profit, there is no tax to have.

The VG rep probably thought that your contribution was pretax.
Tax or penalty? And I did disclose that it was post-tax money. So I should be good, in your opinion, to surrender policy without setting aside money for penalty?
by trixie449
Tue Mar 06, 2018 11:30 am
Forum: Personal Finance (Not Investing)
Topic: 10% IRS penalty on annuity that was 1035 exchange from VUL?
Replies: 20
Views: 1430

Re: 10% IRS penalty on annuity that was 1035 exchange from VUL?

Not completely. "The 10 percent penalty applies to the earnings portion of a withdrawal" - so is that earnings above the $122,000, or nothing since I'm still net-negative?
by trixie449
Tue Mar 06, 2018 11:21 am
Forum: Personal Finance (Not Investing)
Topic: 10% IRS penalty on annuity that was 1035 exchange from VUL?
Replies: 20
Views: 1430

10% IRS penalty on annuity that was 1035 exchange from VUL?

Quick background - I had a VUL that I did a 1035 exchange to a Vanguard variable annuity with last year. Cost basis $144,000, had $122,000 with the exchange, has not yet grown back to basis though is now valued at $133,000. This was all funded with post-tax dollars. I went to surrender the policy (I would like to apply it to my mortgage), and the vanguard rep stated that as I am not yet 59 1/2 I may owe a 10% early withdrawal penalty to the IRS. No state or federal taxes due. Has anyone else run into this? Is the penalty on the whole amount, the earnings, or nothing at all since it was funded with post tax dollars and still isn't to basis? I have paid many a stupid tax, but I would at least like to be prepared for paying a penalty of $13,00...
by trixie449
Mon Jun 26, 2017 2:23 pm
Forum: Personal Finance (Not Investing)
Topic: Should I cancel my whole life policy?
Replies: 80
Views: 13696

Re: Should I cancel my whole life policy?

XDark_FenixX wrote:Final update: VICTORYYYYYYYYYY.
Woohoo!
by trixie449
Mon Jun 26, 2017 2:16 pm
Forum: Personal Finance (Not Investing)
Topic: Variable Universal Life - how long to stay?
Replies: 24
Views: 4531

Re: Variable Universal Life - how long to stay?

Update: Vanguard was a breeze to work with and we did a 1035 exchange from the VUL to an annuity after term insurance in place. Process took about 3 weeks once initiated/term obtained. Thanks again all for your help!
by trixie449
Wed May 24, 2017 6:52 pm
Forum: Personal Finance (Not Investing)
Topic: Should I cancel my whole life policy?
Replies: 80
Views: 13696

Re: Should I cancel my whole life policy?

XDark - did you get it squared away yet? What was the ultimate outcome?
by trixie449
Wed May 24, 2017 1:27 pm
Forum: Personal Finance (Not Investing)
Topic: Variable Universal Life - how long to stay?
Replies: 24
Views: 4531

Re: Variable Universal Life - how long to stay?

Well, I finally have my term insurance in place. Called fidelity and the rep wouldn't allow a 1035 exchange for several reasons:
1) there is an $18,000 (ish) surrender charge so fidelity won't accept any transfer from that account, regardless of where I wanted to put the money. He said to call another company as fidelity wouldn't allow this.
2) the 1035 exchange is only for people who have growth/exceeded basis - whatever the surrender value of the policy is would be the new cash basis, and there would be no growing back to the basis of what is in the VUL. That basis would be wiped clean and I would be starting fresh.

Do I need to try a different rep at fidelity? Try vanguard? There are no Fidelity branches locally. Thanks brain trust.
by trixie449
Sun Apr 09, 2017 7:55 pm
Forum: Personal Finance (Not Investing)
Topic: Variable Universal Life - how long to stay?
Replies: 24
Views: 4531

Re: Variable Universal Life - how long to stay?

MossySF wrote:The prospectus states the commission amount except they usually call it something like unit charge per dollar coverage.

Whether you bail out immediately or stay (w/ stopped premiums) until the surrender charge disappears, you end up losing roughly the same amount. The insurance companies design the policies where both options hit you equally hard.
Thanks - I appreciate the info and input! And no, I am in no way making that sort of money, just learning a good hard lesson :)
by trixie449
Thu Apr 06, 2017 4:59 am
Forum: Personal Finance (Not Investing)
Topic: Variable Universal Life - how long to stay?
Replies: 24
Views: 4531

Re: Variable Universal Life - how long to stay?

pintail07 wrote:As an insurance broker myself, IMO your advisor gave you horrible advice, a huge life permanent life policy to someone single. Oh, did he disclose his commission? About 40,000.
Isn't it disheartening? I trusted this person. My bad. And of course the commission wasn't disclosed.
stevew7 wrote: Illustrations are very misleading, especially on VUL. They are typically 15+ pages long and there is a ton of fine print

The insurance company can raise fees on a whim and you gave them that right when you signed the policy.
Yes and yes! Isn't that just crazy and stupid for me to have signed? Again, trust. Hopefully I'm a bit wiser now having learned a painful lesson.
by trixie449
Wed Apr 05, 2017 5:03 am
Forum: Personal Finance (Not Investing)
Topic: Variable Universal Life - how long to stay?
Replies: 24
Views: 4531

Re: Variable Universal Life - how long to stay?

I think I finally get it! You do the 1035 exchange to allow the investment to grow back to basis without paying taxes on the 'gains'. Forgive my poor terminology please. If we just cashed out and put it in a taxable account, we would owe taxes on the growth from 113K on - however; if we do the 1035 exchange the 113K can grow back into the 168K we had put in without being taxed. At that point, we can move the money from the VA into a different vehicle. I think you need to be really certain when you say "And we actually can stop paying premiums and the policy will remain in force for quite some time." Can you get your insurance salesman to put that in writing? I guarantee you they won't. Here's why. I actually asked John Hancock abo...
by trixie449
Tue Apr 04, 2017 7:33 pm
Forum: Personal Finance (Not Investing)
Topic: Variable Universal Life - how long to stay?
Replies: 24
Views: 4531

Re: Variable Universal Life - how long to stay?

Stevew7 - thanks so much! I have already started the term process. Unfortunately I either am too inept to locate the prospectus online or it's not published. But for those who are curious, it's a John Hancock VUL, 09A I believe from what is listed on the in force illustration. Now your #2&3 are where we get stuck. I thought you could only do a 1035 exchange if you have a profit in the account? As it sounds like you are saying we CAN do the exchange, why do the VA rather than just leave it where it's at currently until the money grows back? The surrender fee gets less and less every year, approximately $1,000 in year 9 and it disappears all together year 10. And we actually can stop paying premiums and the policy will remain in force for...
by trixie449
Mon Apr 03, 2017 5:33 am
Forum: Personal Finance (Not Investing)
Topic: Variable Universal Life - how long to stay?
Replies: 24
Views: 4531

Re: Variable Universal Life - how long to stay?

http://whitecoatinvestor.com/how-to-dum ... fe-policy/

Appears as though WCI has VULs and other whole life policies discussed quite extensively on his website's forum. Though I don't quite understand the 1035 exchange and how to manage the loss, I'm sure with some more research I can get there. I appreciate everyone who has offered advice and helped me think through this process.
by trixie449
Sun Apr 02, 2017 7:25 pm
Forum: Personal Finance (Not Investing)
Topic: Variable Universal Life - how long to stay?
Replies: 24
Views: 4531

Re: Variable Universal Life - how long to stay?

bsteiner wrote:
Was it a financial advisor or an insurance agent? I thought you had to be an insurance agent to sell life insurance.


Isn't that money already spent? Some of it went to pay the origination costs of the policy, and some of it went to pay the cost of the insurance coverage.
My financial advisor is what I had hired her as. I do not know the legalities of who can sell life insurance, but I bought it through her. The way the policy is structured, there is a 'surrender charge' if I cash out the policy before year 10. I have put more money into the policy than what the account is currently valued at (fees etc), but if I chose to cash out the policy there is a steep surrender charge, so I would not receive the actual account cash value.
by trixie449
Sun Apr 02, 2017 7:19 pm
Forum: Personal Consumer Issues
Topic: Second car for larger family - ideas/suggestions?
Replies: 32
Views: 3300

Re: Second car for larger family - ideas/suggestions?

It seems the Camry/Accord that we looked at could easily fit 3-4 kids and applicable gear for a day trip if needed. Any reason for something bigger (not more money, just larger) I'm missing? Depends on the size of the kids and the amount of stuff. I can't imagine taking say 4 12 year olds and their hockey gear in an accord. Something like the mazda 5 (discontinued but you can still get a 3 year old one) sort of splits the difference between an accord and odyssey. We have 4 kids: 15, 13, 11, and baby. We had a mazda 5 and traded it for a minivan when the girls were 13, 11, and 9. Baby had not yet arrived but it was not fun for all 5 of us to be in the Mazda 5. Of note, the 13 year old was adult-sized at that point, and the other two were st...
by trixie449
Sun Apr 02, 2017 6:33 pm
Forum: Personal Finance (Not Investing)
Topic: Variable Universal Life - how long to stay?
Replies: 24
Views: 4531

Re: Variable Universal Life - how long to stay?

Supposedly one of the advantages of VUL is you can stop paying premiums for a time and the policy stays in force. Of course the cash value will drop. Might be a short term solution until husband finds job, etc. You are correct - we can stop premiums; in fact if we drop the insurance value and there are no large market crashes, the policy will stay in force on it's own through my 90's. However, when we look at the fees associated with the VUL and the cost of the insurance portion (John Hancock rep couldn't give me a set cost of monthly fees for insurance saying that the cost of insurance changes every month. Currently about $90/month, but I anticipate based on other people's experiences that as I age the insurance monthly cost will rise dra...
by trixie449
Fri Mar 31, 2017 12:06 pm
Forum: Personal Finance (Not Investing)
Topic: Variable Universal Life - how long to stay?
Replies: 24
Views: 4531

Re: Variable Universal Life - how long to stay?

Thanks all. mhalley: The independent insurance advisor (James Hunt) said it was a good VUL policy, though he questioned some of the investments within it. The FA has been managing those. The ones that I have checked out have expense ratios less than 1%, but when you tack on the FA's 1% cut, plus fees etc... yikes. Just yikes. I should qualify for a decent term policy - no pre-existing conditions, no tobacco, healthy BMI. I enjoyed the link you sent and will be forwarding it along to my husband. WCI - When I bought the policy I was single and easily maxing out retirement sources, paying extra towards student loans, and my FA said it was great and what I needed to do. Since that time marriage, new baby, 3 step kids that we have 50% custody of...
by trixie449
Thu Mar 30, 2017 7:31 pm
Forum: Personal Finance (Not Investing)
Topic: Variable Universal Life - how long to stay?
Replies: 24
Views: 4531

Variable Universal Life - how long to stay?

Please forgive me if this has been answered (ad nauseam) before. I am wondering at what point should I stop my contributions to my VUL, and if/when to cash it out. Some background - I'm 36 and have been contributing to my VUL for a complete 4 years. I'm a physician who was sold this policy by my financial advisor after finishing residency. Annual premium is $42,000, current account value is $131,000, net surrender value $113,000, death benefit is $2,250,000 (increasing yearly). The surrender penalty goes away at year 10. If I stop premiums, assuming 6% returns, the policy reaches the amount I've invested some time in year 11. I recently had an independent evaluator review the policy and he stated it was one of the best VUL policies he's see...