A life insurance policy’s death benefit can be a source of money for final expenses.
We would all like to avoid leaving our loved ones with a financial burden when we pass away. The proceeds from a life insurance policy can be used to help pay funeral costs and last expenses.
Tax deduction is not available.
A life insurance in retirement plan (LIRP) strategy is not tax deductible, experts often suggest that investors should maximize their tax-deferred plans before considering this strategy.
Offset your tax liability.
During your retirement years if you take a withdrawal from certain accounts such a Traditional IRAs, 401(k) or 403(b) they may have an income tax liability. With a balanced financial planning approach, you may be able to minimize your income-tax liability by accessing cash from multiple sources.
Age is an important factor.
Using life insurance as a part of your retirement planning is generally better suited for younger investors because it allows the permanent life insurance policy more time to build cash value (more than 10-15 years), plus life insurance policies are less expensive if acquired in your younger years
Policy withdrawals or loans can be used to supplement your retirement income.
Experts say you will need about 80% of your pre-retirement income during your retirement years1 . A permanent life insurance may be able to offer you access to the policy’s cash value to supplement your retirement income.
Financial support of family members may extend into retirement.
It is not uncommon for people to retire and still have family members who count on them for financial support. The cash value that can accumulate on a permanent life insurance policy be a source of money to help you continue to provide financial support.
Life insurance can be used to replace a spouse’s pension benefits.
Both spouses may want to consider having life insurance. If you are married and your spouse dies, you may no longer be eligible to continue receiving their Social Security or full retirement benefits. The death benefit from a life insurance policy can help replace