What is your experience with taking a bank loan to finance a legacy plan? Especially with today's high interest rates?

Interest rates dropping

Hi anon,

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This really depends on whether you were briefed on the worst case scenario.

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Considering that you specifically mentioned legacy plan, it implies that you won't be seeing any cashflow (compared to say, financing for an annuity).

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Some questions to think about:

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Are you prepared to continue to pay the interest payments for the rest of your life? Are you able to sustain the payments? Can the payments continue if you are incapacitated but not yet gone (i.e. the payout has not been triggered)

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High interest rates won't stay high forever, they will come down, the only questions left being a) how low will they go (I doubt we'll see the rates of 2020 again, for quite a while) b) will they go back up again (which is almost certainly a yes, except that we don't know when)

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So stress test your worse case scenario, and if the numbers work out, then it's definitely something you can consider.