Benefits of
Life Insurance
Life Insurance in Retirement
You may have a basic idea of what life insurance does.
Life insurance has the main purpose of providing for your loved ones after you are gone.
However, life insurance in retirement can provide additional benefits. It makes a great place to keep some of your money, in a spot where it’ll be safe in the event of a market drop. Furthermore, insurance products apply to different tax rules than other financial vehicles.
For example, you may have a retirement plan such as a traditional IRA or 401(K). If this is the case, you pay taxes on your withdrawals. Furthermore, they come with RMDs, or required minimum distributions. This means they have to withdraw funds and pay taxes on them once they reach a certain age. In this case, an insurance policy, such as an indexed universal life (IUL) insurance policy, may be of interest to you. If you “rollover” the money in your accounts into an IUL, you could potentially take the money income-tax-free* from your IUL policy.
Indexed Universal Life Insurance
If you purchase indexed universal life (IUL) insurance, it may be a great way to protect some of your money, and gain interest on it tax-free.* Additionally, this product may offer better rates of return over time than traditional savings accounts or CDs. And, the money in one of these policies can get to your beneficiaries without going through probate court. As we mentioned previously, you may be able to “rollover” the money in another account, into an IUL.
Indexed Universal Life Insurance
If you purchase indexed universal life (IUL) insurance, it may be a great way to protect some of your money, and gain interest on it tax-free.* Additionally, this product may offer better rates of return over time than traditional savings accounts or CDs. And, the money in one of these policies can get to your beneficiaries without going through probate court. As we mentioned previously, you may be able to “rollover” the money in another account, into an IUL. Contact us, we can talk to you about your options.
Choose the Right Life Insurance
When you’re nearing retirement, your objectives probably begin to change. You may be more focused on ways to protect your money. This is because, the older you get, the less time you have on your side. This makes investing in things like the stock market less than ideal.
So, you may be looking for an account that has safety as one of its main benefits, such as an IUL. And, speaking of the benefits of IULs, here’s a list of the benefits of life insurance in retirement:
Benefits of Life Insurance in Retirement
These benefits could include:
- The cash value of an IUL is protected from loss in the event of a market downturn
- You can fund it all at once, or over time
- An IUL gains interest based on a stock market index
- Tax-Free* cash value growth
- You can lock in what you accumulate
- There’s flexibility in how diversified you want your indexes to be
- You can access the money tax-free*
- No fees or fines for accessing money prior to age 59½
Legacy Benefits
These benefits include:
- The immediate death benefit is much greater than the premium paid
- And, the death benefit can increase over time
- Death benefit is income tax-free*
- Additionally, it avoids probate, going directly to beneficiaries
- Could be received as a lump-sum, or as income
- Insured can potentially accelerate a portion of death benefit to pay for long-term care costs