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Life Insurance

Life Insurance In Retirement

You might have a basic idea of what life insurance does. It provides for your loved ones after you are gone. However, life insurance in retirement can give you much more than just a death benefit. With an indexed universal life (IUL) insurance policy, you may be able to receive tax-free* income from it while you are still alive. Life insurance in retirement is an effective way to protect your assets while earning interest on them.

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Life Insurance in Retirement: IULs

Depending on your individual situation, using life insurance in retirement may be a great solution. One reason for this is due to the tax-free* income benefits of an IUL.

An IUL is an insurance policy, remember. And this means that it doesn’t apply to the same rules as, for example, a stock market investment. For example, in your current retirement plan, such as a traditional IRA or 401(k), you pay taxes on your withdrawals. And, when you get to a certain age, you must withdraw some funds and pay those taxes, due to Required Minimum Distributions. If you’re worried about this consequence, an IUL may be of great interest to you. This is because you could potentially slowly convert some of the money from your retirement accounts into an IUL instead. By doing so, you could then take the income tax-free* from your IUL.

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Choosing the Right Life Insurance

When you’re nearing or in retirement, your objectives for your financial vehicles might change. Usually, retirees begin looking at ways of protecting their money more. Similarly, your life insurance goals may be changing.

Life insurance’s main purpose is to provide for your family after you are gone. While this is still important to maintain, it may become secondary to protecting your savings while you’re alive. Retirement brings with it a myriad of additional challenges that may impact your initial strategy. Therefore, choosing the right type of life insurance is vitally important. We can help you focus on protecting your money and your loved ones. An IUL may be able to help you achieve these goals.

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Benefits of Life Insurance in Retirement

There are a number of benefits to using life insurance in retirement. First, there are aspects of IUL policies that can help you during your retirement years. These include:

  • The Cash Value of an IUL is Protected from Losses in the Market
  • IULs Use a Stock Market Index To Determine Cash Value Growth
  • Lock In What You Accumulate
  • Flexibility In How Diversified You Want Your IUL Indexes To Be
  • Can Fund It All At Once Or Over Time
  • Income Tax-Free* Cash Value Growth
  • You Can Access Your Principal & Interest, Tax-Free*
  • No Fees or Fines For Accessing Funds Under Age 59 1/2
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Benefits of Life Insurance to Your Legacy

Benefits of an IUL that serve to benefit your heirs after you are gone include:

  • Immediate Death Benefit, Much Greater Than The Premium Paid
  • Death Benefit is Tax-Free*
  • Avoids probate and Passes Directly to Beneficiaries
  • Can Be Received as a Lump Sum or as an Income
  • Death Benefit Can Increase Over Time
  • Insured Can Potentially Accelerate a Portion of Death Benefit for Terminal or Chronic Illness (Long-Term Care Cost)