I wasn’t planning to write anything until 2026.

But my subconscious mind had other ideas.

I spent an entire night dreaming about writing this post on paper. Not typing. Handwriting. Line by line. When something keeps knocking that hard, I’ve learned to listen.

So here I am, writing what feels like my final Technical Tuesday reflection for 2025.

About a year ago, I published a post that unexpectedly put my name on the map among financial planners, advisors, and life insurance professionals. It began with a simple comparison:

That single analogy sparked a surprising amount of attention. The post traveled far. I received thoughtful praise, enthusiastic agreement, and genuine gratitude. I also received sarcasm, pushback, and a fair share of condescension.

That reaction alone told me something important: the comparison touched a nerve.

This piece is not a retraction of that idea. It’s an evolution of it.

Where I Still Stand on IUL

I still love Indexed Universal Life.

When properly designed and managed, IUL can be a powerful financial tool. What makes it compelling is its core guarantee: protection of principal from market losses, after accounting for policy charges and cost of insurance.

If the market drops, the cash value does not decline due to market performance. What you’ve built remains intact.

Growth, however, is not guaranteed. Cash value is tied to the performance of an external index and is typically credited between 0% and a cap, which varies by carrier and strategy. In recent years, many caps have fallen in the 9–12% range, though uncapped strategies exist with trade-offs in fees or participation rates.

This is where advisor competence matters enormously. Flexibility is a strength only when paired with knowledge. A well-structured IUL can behave much like equity: uneven year to year, but structurally protected from devastating downside.

Why Whole Life Belongs in the Conversation

Over time, my perspective has broadened.

Participating whole life insurance absolutely works too, depending on the objective. Its defining feature is certainty.

Cash value growth is contractually guaranteed. On top of that, policyholders may receive dividends if the carrier performs well. Dividends are not guaranteed, but strong mutual carriers have paid them consistently for over a century.

A common misunderstanding worth clarifying: when people quote 5–8% returns, they are usually referencing dividend scales, not actual internal rates of return. In practice, long-term IRRs often land closer to 4–6%, depending on structure, funding design, and time horizon.

The trade-off is rigidity. What you promise to pay, you must pay. What the carrier promises, you receive. There is little flexibility, but also far fewer surprises.

The Real Estate Parallel Revisited

The home equity analogy still holds.

When you own a house, your monthly mortgage payment is not pure equity. A portion goes to property taxes, homeowner’s insurance, and HOA fees if you’re bougie (or own anything in the DMV).

That’s the equivalent of policy expenses and cost of insurance.

What remains builds equity. Over long periods, that equity has historically appreciated, though never in a straight line. Housing markets are influenced by interest rates, demographics, government policy, and broader economic cycles. There are no guarantees, only trends.

Life insurance cash value functions similarly, but with clearer contractual boundaries around risk.

Choosing the Right Tool

Each strategy solves a different problem:

• Real estate offers long-term appreciation potential with short-term unpredictability

• IUL provides flexibility and market-linked upside with protection against market loss, but relies heavily on proper design and management

• Participating whole life delivers predictability and contractual guarantees at the cost of flexibility and higher premiums

  
  

None of these tools are inherently good or bad. They are situational.

Sometimes the right answer isn’t choosing one.It’s understanding how they work together.

A Final Thought

Financial tools don’t fail people. Poor structuring and poor guidance do.

Whatever path you choose, make sure the professionals advising you actually understand the mechanics, the trade-offs, and the long-term implications of what they’re recommending.

That’s my closing reflection for 2025.

It’s been a year of growth, recalibration, clarity, and a few hard lessons. Sweet and bitter.

But that’s life.

Dr. Linh Trinh An, DMA

Risk Management Advisor | Founder & CEO, Money Umbrella LLC

Disclosure: This article is for educational purposes only and does not constitute individualized financial, tax, or legal advice. Product availability and features vary by carrier and state. Consult your own advisors before implementing any strategy.