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Life Insurance Retirement Plan

Should you have a life insurance retirement plan? That depends on your goals. Life insurance is one way that retirees can ensure those they love are taken care, no matter what happens to them. However, having a life insurance retirement plan means more than just a death benefit. For instance, an indexed universal life (IUL) plan offers a way to earn tax-free income during retirement. Also, an IUL may provide asset protection. Many types of permanent life insurance plans may be available for you to help reach your retirement goals.

IULs may also provide a return on your money. In some cases, the rates you get with an IUL are higher than what you might get in a CD or savings account. So, you still get a secure place for your assets but could see a better gain. Each insurance and investment has its own set of rules, of course. At Cornerstone Wealth & Tax Advisory Group, we make sure to tailor our solutions to your needs. A life insurance retirement plan is sometimes helpful with a long-term strategy.

Retirement and

Life Insurance

Could life insurance help in your overall retirement plan? An IUL, for example, could provide a tax-free income option for retirees. As an insurance policy, and IUL has a "premium." The tax rules are different when it comes to insurance premiums. In fact, the ways in which tax code applies to investments differ from an IUL. When you put money into an IUL, you can access income without taxation.

If you take money out of a 401(k) or a traditional IRA, you will pay taxes. Additionally, when you reach a certain age, you must withdraw money from those assets. This is known as an RMD (required min. distribution). RMDs are, of course, subject to taxes as well. In fact, if you do not take out the correct amount of money by the correct day each year, you could pay a big tax fee. To avoid this, some retirees rollover their retirement money to an IUL over time. By doing so, the money taken out is no longer subject to taxation.

When Should I

Choose An IUL?

As you reach or enter retirement, your need for security may increase. Also, your life insurance needs could change as well. When you're in working years, life insurance needs to provide certain protections. However, in retirement, benefits such as tax-free income may become more important. Keep in mind, some insurance policies may be able to convert to an IUL or other plan. Be sure to contact us to find out which options are right for you.

Cornerstone Wealth & Tax Advisory Group takes the time to meet with clients and understand their needs. When it comes to a life insurance retirement plan, we can go over the details and answer questions about this approach. In addition, we believe that retirement planning and protection go hand-in-hand. Let's get together to make a plan that's right for you.

Why An IUL?

  • Even in a down market, your cash is protected
  • IULs do not link to the stock market; instead, it uses an index
  • Potential gains can be fixed
  • You can choose from multiple indexes
  • Income, tax-free
  • Tax-free withdrawals
  • Flexibility in how you get your money
  • Not dependent upon your age
  • Possible higher death benefit versus payments made
  • Death benefit with no income tax
  • Probate court unnecessary
  • Take income now or over time
  • Chronic illness or terminal illness potential benefit
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Doug Clancy DBA CSWTA Insurance Solutions • CA Ins Lic # 0G20617

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*Proceeds from an insurance policy are generally income-tax-free, and if properly structured, may also be free from estate tax. Income-tax-free distributions are achieved by withdrawing to the cost basis (premiums paid), then using policy loans. Loans and withdrawals may generate an income tax liability, reduce available cash value, and reduce the death benefit, or cause the policy to lapse. This assumes the policy qualifies as life insurance and is not a modified endowment contract. The Host and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any transaction. This content is not intended to serve as the basis for any investment or purchasing decisions, nor does it recommend or involve the purchase, holding, or sale of a security.  All figures herein are hypothetical and for illustrative purposes only to explain general concepts.  No figure is to be relied upon as being accurate nor a guarantee or projection and is meant only as a partial overview of some relevant features and benefits of general insurance products that may be in the marketplace, and whose availability will be dependent on the State of residence of the consumer, and their individual suitability for the product they are wanting to purchase. Where insurance products are mentioned, any and all guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company.

Douglas A. Clancy, Jr., an Investment Advisory Representative (IAR), offers advisory services through Gibbs Wealth Management, an SEC-registered investment advisor. The firm only transacts business in states where it is properly registered or is excluded or exempted from registration requirements. CSWTA Insurance Solutions and Gibbs Wealth Management are independent of each other. Insurance products and services are not offered through GWM but are offered and sold independently by CSWTA Insurance Solutions, CA ins. License #0G20617, and Douglas A. Clancy. Jr., CA Ins. License #0G20617, IN Ins. License #3784426, NV Ins. License #3746478, AZ Ins. License #6378315, MT Ins. License #3002998216, OR Ins. License #6378315, GA Ins. License #670358, FL Ins. License #W217283, and IL Ins. License #6378315 By using this website, you accept our Terms of Use and Privacy Policy. CSWTA’s investment advisory services are available only to residents of the United States in jurisdictions where CSWTA is registered. Nothing on this website should be considered an offer, solicitation of an offer, or advice to buy or sell securities. Any historical returns, expected returns, or probability projections are hypothetical in nature and may not reflect actual future performance. Account holdings are for illustrative purposes only and are not investment recommendations. The content on this website does not constitute a complete description of CSWTA’s investment advisory services. Before investing, consider your investment objectives and CSWTA’s fees. CSWTA is not a bank or depository institution licensed in any jurisdiction. Products offered by CSWTA are Not FDIC Insured, Not Bank Guaranteed, and May Lose Value. All product and company names are trademarks™ or registered® trademarks of their respective holders. Use of them does not imply any affiliation with or endorsement by them.

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