RPR "rich person's roth"?

I thought I was reasonably savvy about retirement options, but I had never heard of this. A “rich person’s roth”, though it isn’t really ROTH. From what I read, it is basically an annuity. One of those that you participate in some of the upside of the market, but it limits your losses to zero. Up-front loads (fees), so it seems it’s a young person’s vehicle since a young person would have time to recoup the loads. Evidently it also acts as life insurance.

Anyone have more knowledge or experience with one of these?

Sounds like indexed universal life insurance. We had a couple long threads on these. Basically they are a rip off.


HAHAHAHAHA Assuming they have assets in a Traditional account, rich people can do conversions to Roth all day long if they truly want a Roth account. So I guess the salesperson is hoping that his rich clients are not smart enough to understand that?

It sounds like you are describing some form of Indexed Universal Life (IUL). There were lots of discussions on the old TMF on the Real Estate board and the Retirement Investing board about that, because Dave Donhoff was pushing them. @Rayvt pushed back really hard with some spreadsheets that Dave was never able to fully dispute, and Dave moved on to other social media. He’s still pushing IULs over on FB.

The ‘participation in market upside’ often has at least 2 issues:

  • It’s generally tied to some market index based on price, rather than total return. The insurance company gets to keep the dividends. Since price action often only makes up 60% - 70% of the total return (depending on the index), you are losing out on 30% - 40% of the market return
  • The price action you are allowed is often capped on a monthly or annual basis. For instance, if the monthly cap that you are allowed is 5%, and the index goes up 10% for that month, you only get 5%, not 10% Since the market tends to have significant spikes, with relatively flat periods between, you are giving away a lot of that spike action.

The fees that they charge are unlikely to be made up, no matter how young/old you are.

Stay away.



This was my source of information after I heard about “RPR”.

Their premise is that taxes are going up, so you need to reduce volatility. “Properly structured” sounds like I’d need a financial pro. My inclination is to stay away, as aj485 said. But I did want to learn a bit more about it so I could say why I’m avoiding it. Other than I think insurance companies should stick with insurance, and not delve into investing.


I keep hearing that ‘taxes are going up’ but I keep seeing Congress actually lower tax rates. And what does volatility have to do with lowering your taxes? The main driver of lower taxes is having less income.

I will also point out that the ‘council member’ who wrote this opinion article likely is making a lot of money from selling IULs.



The main problem is that these things are expensive. Besides not paying the dividends, they also calculate your return by quarter instead of daily, so you miss out on some compounding. RayVT’s spreadsheet showed that in some circumstances in the early years, the IUL will outperform the index. So they actually can work as advertised in some circumstances. But over any reasonable period of time, the index absolutely crushes the IUL.

The supposed advantage is you can borrow against them and spend the money tax free. But retirement assets are lightly taxed anyway, and the outperformance of the index you wind up with vastly more money even accounting for taxes. Again, assuming a reasonable period of time.

The real Rich Person’s Roth is the Megaback door. If you make enough to take full advantage of that you are sitting pretty.


The RPR strategy need not be a universal or indexed policy. It could simply be a whole life policy.

Not stating this in favor or such a strategy, just clarifying for readers. Keep in mind that in order for such a strategy to work, you need to borrow against the policy and that usually involves a fee. There are such things as a “Zero Net Loan” but I have personally never seen one.

Do whole life policies participate in the market upside? Because that was one of the premises that the OP specified.


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The OP clearly did not know what a RPR was so that did not seem relevant. Roths do not require someone have market performance so someone seeking such a strategy could be satisfied with a fixed rate of return found from whole life.

Seeking to inform, not argue semantics.

I appreciate all the discussion about this. No, I did not know what and RPR was until I read that little bit about it. I’m glad it sparked some discussion, and hopefully helped others as well as myself.


I would also point out that author of the original article you cited is not only a financial advisor, he’s an ordained pastor About Us — Strategic Navigators Inc. (stratnavinc.com) of a 2,000 person congregation (per the linked profile). Any time someone is both a religious leader of a large congregation (and even not so large congregations) and is also providing financial advice, that screams that you need to look out for affinity fraud Affinity Fraud | Investor.gov, IMO. Now, maybe I’m cynical because I spent several years in Utah, which has the most Ponzi schemes per capita, mostly spread through relationships formed through the LDS church Does Utah deserve the title ‘fraud capital of the United States’? - Deseret News But I’d rather be cynical and maybe pass up an ‘opportunity’, than lose my money to one of these schemes.