Using Life Insurance For Retirement
Life insurance is important to protect your dependents at the end of your life. It will help to pay for any outstanding debts you have as well as your final expenses (medical bills, funeral costs, etc.). You may have known that, but did you know you can use your life insurance policy in your retirement? In fact, some might say that life insurance is the foundation of a good, solid retirement plan – especially when there are other family members involved.
Creating A Plan
When you sit down to create a retirement plan, whether you’re 30 or 60, you’ll need to consider finances. How are you going to support yourself and your family when you are retired or unable to work? Most people who work for corporations have a 401k – an employer-sponsored account in which a percentage of your salary is placed in a special account that you can use in retirement. 401k funds are tax-deductible, making them a great way to save for retirement. If you don’t have an employer who offers a 401k, you can still create your own savings account in which you save a certain portion of your paychecks. If you’re still looking for another savings method, you can turn to life insurance.
Even if you do have a 401k, you may need an additional savings account. The IRS places a limit on 401k compensation of $18,000 per year (in 2017), so if you want to save more than that each year (if you can, you should), you’ll need another savings account and/or life insurance.
Indexed Universal Life Insurance, or IULs, grow in value over time. They are tax-free plans that are not affected in the event of depreciation. Like any other life insurance plan, the money involved is released to your appointed beneficiary when you die, but there’s more. You can take out the cash value of your policy at any time without any fees. This is helpful in retirement if you max out your 401k or need extra savings.
InsureTN can help you find and compare life insurance quotes. Call for yours at 615-964-5250.