Is it worth it to get a GIUL Policy?

I was recently pitched on the value of a Global Indexed Universal Life Policy from ING. I came up with some math showing how it’s a really bad value in the shorter term (20-30 years). Obviously, these policies have potential for tax savings at the 70 year old mark (assuming an investor in their early 30s), however they lock you in to a single investment strategy over a very long period of time.

I was quoted $438.06 per month fee for the GIUL.

I don’t believe that I anyone can afford these GIUL policies because it forces people to invest in the same way for a 30-50 year timespan. I think that people would rather have more control over my investing choices. Personally, I’d rather be able to change my mind and invest in different sectors like real estate or mutual funds of my choosing. With a GIUL you do not have that control.

Also, it’s like a forced savings plan, and it just feels unsafe in that you would have to make that payment every month. Miss it? Risk losing everything.

Throwing money away for the first 7 to 10 years!

Since there’s basically no benefit for the first 7 to 10 years (except the life insurance death benefit which is an important benefit) I felt like the next 7 to 10 years are the ones I would like to have liquid assets (and, working on paying off house).

Contrast: I think I can get term life insurance for approximately $100/month.

I took the last 20 years of the S&P 500 and it looks like it had an annual rate of 6.24% from Dec 31, 1992 through Jan 2, 2013. Investing $338.06 per month for those 20 years would have resulted in a return of approximately $162,692.37 which is more than the 20 year net surrender value of the GIUL policy. The GIUL policy has a surrender value of $149,307 at 20 years (assuming 8.5% return).

Assuming a term life policy only cost me $100 month during that period, I would be only down $24,000. Plus, if I were to die 20 years from now, and carried a term policy at that time, I’d have the death benefit from that + my investment return as well. I am having difficulty seeing why I wouldn’t want to do that.

It’s very important to run the math on these! Instead, fund your Roth IRA to the max.

From what I can understand about a GIUL policy, the death benefit would be all a person would receive if I were to die before an older age.

In other words, if you die, you only get the death benefit, and none of that money you’ve been “investing.”

That’s just not a good investment practice. Why risk that? For less money, you can have a term life insurance policy that protects you, and then anything I invest I know I will have access to. It’s way more liquid. I’d much rather wake up 20 years from now having “invested the difference” and have a liquid nest egg than have it be tied up in an insurance policy.

Your insurance salesperson will tell you that you do have access to that capital… by explaining that you get access to that money by borrowing it from the policy, but there are some tax implications there that can’t be overlooked.

I also am having a hard time coming to terms with the idea that if I died within the first 7-10 years I am not further ahead than if I “invested the difference”.

The insurance salesperson will ask: Will you really invest the difference? The answer is yes, absolutely! I’ll invest it in life, travel, and retirement.

A few questions to ask your insurance salesperson:

Question: Is there a cap on how much I can earn on the investment? I read somewhere that dividends earned by the S&P 500 aren’t paid out, is that true? What are my approximate fees? From reading an article, I get the idea that long-term it actually pays off admirably. But, I guess I’m just not so convinced of the idea that I should limit myself to placing a sizable percentage of my income for the next 30+ years into one investment method.

As a comparison, you’ll want to fund a Roth IRA to the max ($5,500/year) every single year that you can. Never miss a year.

What if you die at an early age?

Looking at it further, if I were to die at 63 (age my mom died) after 30 years of investing in the GIUL policy I would have invested about $152,444.88 over that time. The death benefit is $500k and the Net Surrender Value is $380,194.

If we take the S&P 500 average over the last 30 years we get 8.120% return. After 30 years of investing $338.06 on a monthly basis I would end up with $507,944 which is more than the death benefit. Let’s guess over that period I would have paid out $36,000 for a 30-year term (might be low). Even taking half of the proceeds for taxes and fees, with a term-policy my spouse would be left with a term-life death benefit and the “invest the difference” investment of maybe $250,000.

The GIUL looks like a really good deal if I don’t die. And that’s the trouble. You don’t know, and if you do die, you’ll have lost a fortune.

There are a ton of videos on YouTube where insurance salespeople will pitch life insurance, and provide various examples of why term-life insurance is a bad deal. Here’s one example showing a sales person attempting to show how to handle a customers objections.

You’ll obviously want to do your own research. Personally, I came to the conclusion that the GIUL Policy is a very bad deal, and that you should always go with term life insurance. Don’t get talked into a fancy life insurance policy! It isn’t worth the risk. Seriously, don’t even consider getting anything besides a term life policy.

Note: I don’t sell life insurance, never have, never will. I’m a designer and writer, and not in that business at all. Take my advice: Don’t get a GIUL!

Dave Ramsey

I’ve been listening to Dave Ramsey’s radio show recently and have to say, I’m hooked. Sure, he’s been broadcasting since 1992, but why would I have listened then since I didn’t care about finances when I was a kid?

I know this isn’t about time tracking, but bear with me. Hours are money if you work for a living (and, who doesn’t?).

Listening to his show reminds me of talks I had with my mom when I was younger. We’d talk about everything under the sun, including financial topics. Dave Ramsey really teaches how to get out of debt, save for retirement, and pay off your house.

He has a thing he calls “Baby Steps,” and here’s the process:

Baby Step 1: $1,000 to start an Emergency Fund

Baby Step 2: Pay off all debt using the Debt Snowball

Baby Step 3: 3 to 6 months of expenses in savings

Baby Step 4: Invest 15% of household income into Roth IRAs and pre-tax retirement

Baby Step 5: College funding for children

Baby Step 6: Pay off home early

Baby Step 7: Build wealth and give!

Anyways, I wanted to share since this guy has some really terrific things to say about financial planning, and I’ve been watching it a lot recently.

One of my favorite quotes, which is almost his slogan is: “If you will live like no one else, later you can live like no one else.” ― Dave Ramsey

You can read some other quotations here.

Harvest Mac App

I’ve been using the Harvest time tracking service for about 10 months now (since October), after switching to it from a desktop application for time tracking.

I have to say, I love it!

I primarily use the Mac App, which is featured in the video above. It interfaces with the web site (which I rarely use except to add projects, clients, and run reports).

A couple of things that I would recommend they improve:

1. An option to set the start time immediately after my previous entry. Use case: I stopped my previous time entry, and accidentally let 15 minutes go by before starting my time and now I want an easy way to set the start time to be immediately after my last time entry ended. See this screenshot.


2. Show gaps in my day in a different color, and allow me to assign those to another entry. I’d like to be able to see where there are gaps in the time sheet entries from my day (either a new one, or the previous or next entries). For example, see this screenshot.

3. Have it so that it remembers my last description so I don’t have to re-type it if I want to only make a minor change. I’ve managed to figure this one out: Just click start on a previous entry, and then if you want to leave it alone, it will keep the time entry notes.

4. When entering time manually, allow me to enter the duration, not just the start/end times. Sure would be nice to be able to just enter “1 hr” rather than having to enter a specific start time and end time.

List of Time Tracking Apps: Our very own time tracking tools list

A lot of people probably are unaware that we maintain a list of time tracking applications. We realize that everybody tracks time for different reasons and a time tracking tool that works for one person might not be perfect for another.

That’s why we encourage you to check out where we currently have links to over 50 time tracking apps — from software to web. We’ll be maintaining this list and adding new apps whenever we spot a new one. Thanks!

Note: Our list is often updated, and the latest update was on August 5, 2013.

An observation about time tracking software

When selecting a time tracking tool it is important to choose something that offers you both flexibility and is easy to use. If you’ve ever used Basecamp, Freshbooks, or Harvest to track your time you’ll be familiar with the fixed “Client > Project > Tasks” structure which you must follow. Time must fit into that a project and projects must be associated with a client.

But what if you want to track your non-billable time or don’t need a whole “project” just to track a few hours here and there? That’s where these tools break down. If you want to track time for trivial tasks like “Email” or “Writing Proposals” you’re out of luck.

Most time tracking tools make it difficult to calculate your billable efficiency — the percentage of your time that is billable compared to non-billable. If you track all of your time this is possible.

Story from the book “Art and Fear”

The ceramics teacher announced on opening day that he was dividing the class into two groups.

All those on the left side of the studio, he said, would be graded solely on the quantity of work they produced, all those on the right solely on its quality.

His procedure was simple: on the final day of class he would bring in his bathroom scales and weigh the work of the “quantity” group: 50 pounds of pots rated an “A”, 40 pounds a “B”, and so on.

Those being graded on “quality”, however, needed to produce only one pot — albeit a perfect one — to get an “A”.
Well, came grading time and a curious fact emerged: the works of highest quality were all produced by the group being graded for quantity.

It seems that while the “quantity” group was busily churning out piles of work-and learning from their mistakes — the “quality” group had sat theorizing about perfection, and in the end had little more to show for their efforts than grandiose theories and a pile of dead clay.

Cost of commuting

timeSomething I’ve been thinking about lately is the cost of commuting. If your daily commute takes 20 minutes (round trip), as mine does, how much time are you really spending per-month, and per-year behind the wheel?

Let’s do the math.

There are 251 working days in 2013, and assuming 10 days of vacation per year it’s safe to assume the average person will commute 241 days out of the year.

Therefore, we come down to total time behind the wheel in 1 year: 80.33 hrs. DANG! So, yeah, for a short commute like that, the average person spends two-work-weeks behind the wheel. Tragic.

You could be spending more than 160 hours, or a months worth of work-time behind the wheel every year if you have a 20 minute one-way drive.

So, what is the true cost of commuting? Well, add in gas and lost-time and it could be significant. Is it really worth it to spend that much time in your car?

Connecting (Full Film)

The 18 minute “Connecting” documentary is an exploration of the future of Interaction Design and User Experience from some of the industry’s thought leaders. As the role of software is catapulting forward, Interaction Design is seen to be not only increasing in importance dramatically, but also expected to play a leading role in shaping the coming “Internet of things.” Ultimately, when the digital and physical worlds become one, humans along with technology are potentially on the path to becoming a “super organism” capable of influencing and enabling a broad spectrum of new behaviors in the world.

Connecting (Full Film) from Bassett & Partners on Vimeo.


Well, I ended up using Harvest. Been tracking it for a month and a half now, and I really like it. If it wasn’t for the OS X app I would have passed, but the ability to track my time without getting into the web browser is a killer feature.

Web browsers to me are distractions. It’s awesome to use a desktop app.

Try Harvest (referral link):

Time tracking: Choosing a time tracking system for your business

Time TrackingWhat time tracking application do you currently use for your business? There’s definitely a lot to consider, and I think everybody is looking for something a little bit different.

Here’s what I have been looking for:

  • Logging of time with start and end date stamps – I need to know when this time was logged… not just the day it was logged.
  • Easy invoicing – either in the service, or really great export options to Excel or another invoicing app – like Freshbooks.
  • An OS X app – it’s 2012 people, I need to do this on the desktop. Also, iPhone apps are great and I like that as a bonus.
  • Daily report – I posted a few years ago about how I work, and one of the things I love about Complete Time Tracking Pro is the daily report. It’s beautiful and shows me the gaps in my time logs.

So, what are some of the apps I am considering:

  • Complete Time Tracking Pro – have used this for over 5 years – awesome Windows app, but it’s time to move on to something that’s a little more modern, and web based, and has an OS X desktop app. I know certain people (yes, you) will think it’s crazy to move on, but I’m not so convinced that another app will really reduce my productivity or reduce my ease in invoicing.
  • Harvest – seriously considering this as a viable option.
  • Toggl – looks really nice and I like some of the interface ideas they have implemented.

I may do another post in the future about my selection. If you’re interested in this topic, check out my article from 2010 about my obsession with time tracking.

The battle between the organizers and the hoarders

Organizing Is Often Well-Planned Hoarding. The key paragraph:

“No matter how organized we are, we must continue to care for the stuff we organize, cleaning and sorting our methodically structured belongings. When we get rid of the superfluous stuff, however, we can focus on life’s more important aspects. Said another way: We can spend the day focusing on our health, on our relationships, on pursuing what we’re passionate about. Or we could, of course, reorganize our basement again.”

Walnut clock

This beautiful walnut clock is made from a solid piece of Walnut which is then fitted with a solid American Made mechanism and brass accents. The three brass “O”s live in the three position. This clock wants to be in your living room, whether your style is vintage modern, mid-century, or soho chic.

Via: Customatic