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Base vs. PUA: What do I need to know?

Base vs. PUA: What do I need to know?

During your over-the-phone strategy session with your Money Mentor, you will decide the total premium you want to put into your banking policy. That total premium is made up of two parts, Base Premium and Paid Up Additions, or PUA. 

Let me explain the importance of each by using the analogy below. 

You have a rocket. The main body of that rocket represents the base premium. Then, you have the boosters on that rocket which represent the PUA in your policy. 

The piece that gets your policy to immediately take off and perform for you right away is the PUA, or the boosters on the rocket. After a time, those boosters have done their job. In the case of the PUA, it has driven the cash value in the early years of the policy. This allows you to utilize your cash value immediately. But at a point, PUA becomes unnecessary and drops off the policy. This is similar to how the boosters drop off the rocket after they’re no longer needed. 

You’ll notice the majority of your total premium goes to that PUA rider.

This is one of the largest components of making this banking policy function optimally for your individual banking purposes. 

However, the base premium is also very important. We want to create banking policies that are designed for the long term, too. Not just for the short term. So, later on when the PUA drops off the policy, the base premium is what will drive that cash value for the long term. This way, you get both immediate and long term usage out of your policy. And we’re doing it the most efficient way possible for the dollars inside your banking system.

When you’re ready to get started on creating your financial legacy or if you have more questions, most questions can be answered by watching this video. Start there and then schedule a consult with my team when you’re ready to begin.


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