The Insured Retirement Program

Did you know?

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One of the most common criticisms of life insurance is that the person paying for the policy may never personally benefit from it. However, that isn't always the case.

Participating whole life insurance policies can build tax-advantaged cash value over time, creating an asset that can be accessed during your lifetime to help support your retirement income.

When structured properly, the strategy works as follows:

1. Qualify for and purchase a participating whole life insurance policy.
2. Contribute amounts above the required annual premium through additional deposit option payments.
3. Continue making these additional contributions throughout the life of the policy, allowing the cash value to grow on a tax-advantaged basis.
4. Upon retirement, use the policy as collateral with a lending institution to establish a line of credit.
5. Access the line of credit annually to supplement retirement income.
6. Because these funds are received as loan proceeds, they can generally be accessed on a tax-free basis.
7. Upon death, a portion of the insurance proceeds is used to repay the outstanding loan balance, with the remaining death benefit paid tax-free to your named beneficiaries.

This strategy is typically most effective when implemented over a long-time horizon, allowing the policy's cash value the opportunity to compound and grow. The earlier you start, the greater the potential benefit.

Contact our office to learn whether this approach aligns with your financial goals and retirement planning needs.

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