Most people are familiar with Term Life Insurance. It is a cost-effective way to get temporary protection, but gets expensive as you get older. Whole Life Insurance is designed to protect you for your entire life and build cash value over time.
The Remarkable Advantages of Whole Life Insurance you need to know.
Most accountants and financial advisors do not have a deep understanding of whole life insurance. How could they? They have not been immersed in it for many years. It’s no wonder that the nation’s wealthiest institutions and individuals own billions of dollars worth of Whole Life. With properly designed policies you can take advantage of powerful benefits like these:
• The monthly payment for Whole Life Insurance stays the same for life.
• The cash value growth is guaranteed unlike mutual funds or stocks. When the market crashes, you won’t lose a dime.
• You have access to the cash value upon request, without penalty. And it can be set to be Tax-Free.
• Once in place, whole life insurance is guaranteed for the rest of your life.
• It is legal to own several Whole Life insurance policies.
• Life insurance policies placed in an irrevocable trust are not counted as part of an estate, or taxed by the federal government.
• You can incorporate long-term care and chronic care medical expense protection.
• As a business owner, you can insure a key employee to protect the business and the employee’s family. The cash value is an asset of the company and can be set up to supplement tax-free retirement income. You can also protect the full value of the business if you retire or sell.
Leverage the power of Tax-Free to protect your family wealth and assets
Life insurance can protect your business assets and family wealth. The proceeds of life insurance are income tax-free to the beneficiaries. This helps heirs to avoid complications or getting into a financial wrestling match with each other.
Business owners have even more advantages.
If you have a business partner, whole life insurance can fund a Buy/Sell Agreement in the event of an owner’s sudden death or a partner’s passing before retirement. The cash in the policies can also help fund a buyout if one partner wants to leave. A knowledgeable insurance advisor can help implement a smart,strategic succession plan.
A Key Person Insurance policy protects a company from going out of business,should an owner, founder, or key employee passes away before a replacement is found or sale is made. An added benefit: the proceeds of the policy are income tax free.
Protection Tactics and Strategies with Life Insurance
Example 1: I Love My Spouse. IRAs and 401Ks are taxed when funds are withdrawn. Let’s say John has $900,000 in his IRA account. His wife Jane will lose a large percent of the funds to income taxes should he die. James, however on the advice of his very knowledgeable insurance advisor, buys a properly designed life insurance policy with the funds from his IRA. Now should something happen to James, Jane will now receive a $2 million income tax-free benefit.
Example 2: Double the Protection, No Charge. Robert had a 20-year-old policy with a cash value of $850,000 with a death benefit of $1.53 million. He needed to increase his coverage to keep his growing family protected. He can implement The Tax-Free Insurance Policy Exchange (IRS code 1035). It will double the coverage to $3 million without any additional out-of-pocket financial outlay.
Example 3: Free Golden Handcuffs. Alice owns the town’s most popular Gourmet Coffee & Cupcake Café. Her star baker Alex is invaluable to her success and growth. She’s afraid she might lose him to competitors and can’t afford to replace him. So, she rewards him in a big way. She insures Alex for $1,000,000 with a Key Person Whole Life policy. If something happens to Alex while employed, his family will be protected. The policy will also build cash value for Alex if he works for an agrred-to number of years. Alice will use part of the cash to cover her costs and supplement Alex’s retirement income.
Protect Yourself at All Times
Only a true insurance professional with years of experience and expertise can properly structure the life insurance policies that are right and affordable for you. At the Cesiro Insurance Agency we will personally spend the time it takes, face-to face, to discuss protecting your family assets and your wealth. We welcome reviewing any plan or policy with any of your trusted advisors. Of course there is no obligation.