Life Insurance

Protect Your Assets and Family

Leaving money to protect your family’s finances in the case of your passing is a huge part of effective financial planning. It’s critical for young families, but new policy designs can also offer many features to older people, including long-term care funds, spousal income protection, and tax-free retirement income in the form of policy loans.

Here are just some of the reasons you should consider life insurance:

  • Protect your spouse and children from the loss of a breadwinner
  • Help ensure your family can continue their lifestyle
  • Protect a spouse’s income in retirement (remember one Social Security check goes away upon a spouse’s death)
  • Provide adult children and grandchildren with a tax-advantaged wealth legacy
  • Borrow against cash value in a policy tax-free for any purpose, even retirement income, as long as your policy stays in force.
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Life Insurance 101

Life insurance can be leveraged to leave a larger wealth legacy to your loved ones, in most cases, bypassing probate and going to your named beneficiary or beneficiaries tax-free. There are many different types of insurance, and each individual life insurance contract is unique. Here are the basics about life insurance, what you should know about what it can cover, and what might be right for you and your family.

Here Are Some of Your Choices When It Comes to Life Insurance

1) When you’re young, you can purchase a term life policy which expires someday. It’s usually less expensive and it allows you to protect your family from the loss of you or your spouse as the primary breadwinner.

2) Even when you are young you may choose a more long-term life insurance solution, like a permanent whole life or indexed universal life policy. They cost more, but part of the amount you pay goes into the “cash value” that builds up inside the policy. The cash value can be borrowed later, usually tax-free, for any purpose. Your policy will “charge” interest, but in some cases, the interest “paid” on the policy zeroes this out, or it even accrues at a higher rate. Permanent policies can be purchased at nearly any age, as long as you are relatively healthy, and older adults often purchase them for covering a surviving spouse’s lost income upon their passing, and for leaving a tax-advantaged legacy for their extended family.

3) Also available from life insurance companies, a fixed indexed annuity is another option that can provide lifetime retirement income while protecting your principal from stock market loss. You can purchase a deferred annuity years before you retire, or an immediate annuity for retirement. Fixed indexed annuity contracts are credited interest based on a benchmarked index like the S&P 500, and guaranteed interest can be credited per contract terms, backed by the financial strength and claims-paying ability of the insurance company providing the annuity contract. Annuities are long-term contracts, and come with surrender fees, so we will help you consider your whole financial picture including keeping adequate reserves and emergency funds on hand.

4) Funds for long-term care are available as part of some life insurance or annuity policies. In some cases, they are part of the main policy; in other cases, they can be added as policy riders. Unlike traditional long-term care stand-alone policies which simply cancel if you don’t need care after you’ve paid premiums on them for years, with these hybrid policies, if you don’t need care then money will be passed to your loved ones as a tax-advantaged death benefit.