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IUL Policy In Retirement

What can it do for you?

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Generally, all life insurance provides the same broad benefit. When you are gone you want your family to be ok financially. However, an indexed universal life insurance policy may offer much more. For instance, with and IUL, you may be able to have income that is tax free. In addition, an IUL might also protect some of your assets in retirement. Other benefits include the possibility of earning a reasonable rate of return on your cash value IUL policy over time. 

Some IUL’s offer alternatives to lower-earning account, such as CD’s or money market accounts. Also, retirees can use and IUL for its legacy benefits, too. For example, income left to your beneficiaries is non taxable for the recipient. This is because the money paid to them is from the cash value of an insurance policy, not an investment account. Additionally, your loved ones listed as your IUL beneficiaries do not have to go to probate in order to access this money. If you have a life insurance policy now with a cash value, talk to us about options for upgrading those policies to an IUL. Of course, not all products qualify for this type of transaction. So, be sure to reach out regarding your specific situation.

Strategy for an

IUL Policy

Although every situation is different, it may be worth taking a look at the specifics of an IUL policy. First, an IUL offers tax-free* income potential. Keep in mind that an IUL is an insurance product. As such, the money you put in (known as the premium) is not subject to the same tax rules as investment money. In fact, your cash in an IUL isn’t invested in the stock market at all. Instead, it uses an index.

Traditional IRA’s or 401(k)’s, for example, require you to pay taxes upon withdrawal. In addition, once you reach age 72, the tax law says you must take some money out. The least amount you can take out is the Required Minimum Distribution (RMD). If you are looking for a way to convert this money into tax free money, you may consider an IUL. Specifically, some of your retirement account money may be able to slowly go into your IUL. Therefore, the income would become tax free income. Certain conditions do apply so be sure to learn more.

IUL policy options
Goals for

Life Insurance in Retirement

Often, as we near retirement, our needs change. Therefore, our investments change, too. Typically, retirees consider more tactics that protect their money, versus taking too much risk. Usually, this change occurs when it comes to life insurance as well. In your working years, you may have had an insurance policy to provide for your family if you couldn’t. Now you’ve built up retirement savings. So, your life insurance may not be needed for its original purpose anymore. Instead, you may look at an IUL policy for some of the other benefits it offers.

Without a doubt, retirees still want protection for their families. However, when you retire, there are new issues to contend with. These include things like taxes, estate planning, and other changes. Therefore, the type of life insurance you choose is important. Choules Financial has a focus on protection. In fact, we have expertise in the insurance industry. We are here to help you protect your hard-earned money and learn your options. Reach out to determine if an IUL is right for you.

At Choules Financial, we know how important it is for you to have all

The knowledge you need to make retirement decisions.

Want to find out about IUL policy information in retirement? Call us today. Or, connect with us at one of our events to learn more.

IUL policy

IUL Policy Benefits (Especially in Retirement)

Retirees sometimes use an IUL policy as part of their retirement strategy. Indeed, some benefits of these products may help you as you retire. Some examples include:

  • IUL policy cash value does not depend on the market
  • A stock market index provides cash value growth
  • Lock in your gains if you choose to
  • Choose number of indexes you want for your IUL
  • Tax Free Income
  • Principal and interest are available, tax free
  • Fund your IUL over time or all at once
  • Take out money before age 59 1/2 without a fee
IUL Policy
In addition

you can leave a legacy with an IUL

After you pass on, your beneficiaries will have benefits that may include:

  • Premium paid is less than the death benefit they receive
  • Tax free death benefit
  • No probate – money goes directly to who you want it to go to
  • Can be taken as an income or paid in a lump sum
  • Over time, the death benefit may increase
  • Option to receive some money from policy early due to terminal or chronic illness
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