X-Message-Number: 12411 From: "John de Rivaz" <> References: <> Subject: Re: Insurance vs mutual funds Date: Mon, 13 Sep 1999 10:41:46 +0100 I am afraid that I am still not clear on this. With a life policy comes a bit of paper which is a trust which designates someone other than the person paying for the policy as the owner of the policy. After it is signed, the person paying for the policy has no further control over what happens to the proceeds. This confers freedom from tax and freedom from litigation benefits. Is there any fundamental reason why a similar piece of paper cannot be written concerning a holding in a mutual fund as opposed to a life policy? The only difference I see is that the life companies provide this piece of paper included in the price of the policy, whereas a buyer of a holding in mutual funds has to pay a substantial sum to an attorney to produce a similar piece of paper. There are form books such as Doug Casey's "How to avoid probate without a lawyer" which offer forms that are said to produce similar effects. However lawyers often see them as a means to earn money by encouraging people to contest them.This is good for their profession as a whole and good for the people who win such cases. People are less likely to be persuaded to contest life policies as their legal action would be against the financial might of a life insurance company motivated by the need to demonstrate to the public the safety of its products. The difficulty I see with life policies are that 1. you may be paying for protection you don't need 2. you cannot invest in technology stocks, so transcessionary pressure will erode your investment (as well as the lost opportunity). 3. they are a lot more bother to buy than buying mutual funds - if you want a holding in mutual funds and you have the money you just write a check and that is it. -- Sincerely, John de Rivaz my homepage links to Longevity Report, Fractal Report, my singles club for people in Cornwall, music, Inventors' report, an autobio and various other projects: http://ourworld.compuserve.com/homepages/JohndeR > But mutual funds, in a trust or not, do not create the "instant" estate that > life insurance does. Although I love mutual funds! Own 'em and sell 'em. Rate This Message: http://www.cryonet.org/cgi-bin/rate.cgi?msg=12411