Life Insurance
Should You Purchase Life Insurance For Retirement?
Does your family depend on your income? You should probably consider purchasing life insurance for retirement. You’re probably aware of the main function life insurance has: it allows you to leave money behind for your beneficiaries after you pass away. But, what if we told you that the right type of life insurance policy could be used as a source of income for you while you’re still alive?
How a Life Insurance Policy Works
The insurance company issues you a life insurance policy in exchange for the premium that you pay. The insurance company agrees to keep your money protected. The cash value of you policy is guaranteed to grow tax-free. Your policy is not invested in the stock market. In fact, no matter what happens in the market, even if another crash happens, the money in your life insurance policy will remain protected. This may provide you with more confidence and certainty in retirement.
If you borrow against your cash value, the money in your life insurance policy can be used as a source of tax-free* income. So, if you have money saved in retirement accounts and don’t want to dip into those yet, purchasing a life insurance policy and taking money out of it may be an advantageous option for you.
Benefits of Using Life Insurance For Retirement
Life insurance for retirement comes with a number of benefits. First, let’s list off the features of these products that will mainly help you during your retirement:
- The cash value of your policy will remain protected, even in the event of a market drop
- Fund your policy all at once, or over time
- Tax-free* growth, and tax-free* access to your principal & interest
- No fines or fees for accessing your cash value before age 59 1/2
Legacy Benefits
Benefits offered to your beneficiaries after you are gone, meanwhile, include:
- Immediate death benefit, avoiding probate court
- The death benefit is tax-free*
- Furthermore, the death benefit can be much greater than the premium paid
- And, it can increase over time
- The benefit can be received as a string of payments, or one lump-sum