by r98986
Last night, I was taking a hot shower and had some shower thoughts, and got this breakthrough idea which might be able to help me offset -$56k losses that have occurred to me in the past few years since 2012. (Not my fault. You know that the market has been difficult for past 7 years).
Right after the shower, I started looking at the term-life insurance products and their rates and learned that life insurances are surprisingly cheap. Did you know that it only costs around $50~60/month to get a 30-year term life insurance of $1 million? Yes, you heard it right. $1,000,000 for only $50/month.
I didn’t stop my research there, and I adjusted a few input criteria to increase my potential profit, and I was able to get the rate of $125/month for 30-year term life insurance for $2 million. I suspect that the rate is probably very good because I am not a tobacco user, I don’t drink, and am very healthy.
So, using $125/month and $2,000,000 return as a basis, I decided to calculate a few exit options to get potential profit %.
For example, if I die right after I pay for the first-month payment of $125, I will get $2,000,000 in return. That would be whooping 16000+ times (aka 1600000%) return on investments.
If I die after 20 years of investment, ($30000 payments total over 20 years), I will get $2,000,000 and that is still 60+ times return on investment.
Below is the table for those of you who are data-oriented investors&strategists.
| When I die in | Payments made | Profit | Profit % |
|---|---|---|---|
| 1 month | $125 | $2,000,000 | 1600000% |
| 12 months (1 year) | $1500 | $2,000,000 | 133333% |
| 240 months (20 years) | $30000 | $2,000,000 | 6666% |
| 300 months (25 years) | $37500 | $2,000,000 | 5333% |
So, in terms of profit %, dying after 25 years of payment is not that bad and is still great… but dying as soon as possible, preferably only after a month of payment will maximize the profit %.
Once I get $2M in return, I can pay off my car loans & CC debts, subscribe to Netflix/HBO/Hulu at the same time, and most importantly, I don’t have to deal with banks rejecting my mortgage applications any more due to my low income. I will be able to buy a house with 100% offer.
I am thinking of owning one in southern California and one in Asia, so I have already shifted my research time more on learning good house interiors & DIY home improvements, and less on stock markets.
Also, I will no longer need to pay rents after I buy the house which is just a free side benefit that comes with becoming a homeowner.
There might be some tax implications for $2M earnings which I haven’t researched yet, but I think it won’t be a problem so much since I will have so much money in my hand.
I am thinking of closing my brokerage account soon, and start investing using this strategy. I usually spend around $2000+ dollars on executing trades alone per year (My brokerage charges you ~$5 per trade). So I should not have a problem paying for $125/month if I use this strategy. I still have plenty of credits left in my CCs and can probably ask my family members to co-sign loans for monthly insurance payments, although I don’t think that will be necessary.
This strategy is kinda fail-proof and you can’t go tits up, because life insurance companies that I researched for the quote above have ratings above A+, (for those of you who don’t know, company ratings are very important factor in life insurance domain, and companies with A or higher ratings don’t usually go south, and have been there for more than 50~100+ years), so I don’t have to worry about them going down, where typical biotech companies disappear overnight, and many companies have short lifespan.
Thoughts? Questions? If you want to follow my strategy and have questions, let me know!
P.S. By the way, I am talking about term-life insurance here, not the whole-life insurance which is way too expensive and nonsense. (They cost like $1000~$1200/month), so I don’t think they are worth it. I don’t even see much difference between those two either.
Disclaimer: This content does not necessarily represent the views of IWB.