What Do I Need to Know About Life Insurance Inside a Qualified Plan?

What Do I Need to Know About Life Insurance Inside a Qualified Plan?

Qualified retirement plans are designed to encourage employees to save money now, so that they will have enough to sustain themselves when they are no longer working. A plan like this meets all the requirements of the Internal Revenue Code, which means it is eligible for certain tax benefits. In simpler terms, a qualified plan is a tax-favored accumulation vehicle like permanent (cash value) life insurance.

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Seeing Into The Future of Your Life Insurance Policy With An In-Force Illustration

Seeing Into The Future of Your Life Insurance Policy With An In-Force Illustration

An in-force illustration is the only way to gauge the potential future performance of a policy by using actual values and current assumptions (i.e., actual interest rate, current mortality and expense factors) to produce a current policy illustration. It allows you to compare past (actual) performance with anticipated performance.

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Is a policy inside a qualified retirement a good idea?

Is a policy inside a qualified retirement a good idea?

Paying life insurance and annuity premiums with qualified-plan dollars is quite controversial. Every situation is different; some may benefit from a plan life this while others may not. A good place to start is by looking at a 403(b) plan, which is a tax-deferred retirement plan for employers of school and other nonprofit organizations.

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Guarantee death benefit on cash value life insurance

Guarantee death benefit on cash value life insurance

When it comes to universal life (UL) insurance, one of the biggest concerns is that the death benefit is not guaranteed for the life of the policy. Most policies will terminate or mature at age 95 or 100 and cash out at that time. When this happens, it leaves the client with the cash value, which is often less than the death benefit.

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What are the types of permanent (cash value) life insurance?

What are the types of permanent (cash value) life insurance?

The metaphor of a barrel rolling down a hill is a basic portrayal of how a cash value life insurance policy works. It effectively explains how premiums add funds to the account, how insurance companies take out their expenses and how to calculate your surrender value.

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Qualities of permanent (cash value) life insurance

Qualities of permanent (cash value) life insurance

Permanent life insurance has a level premium that must be paid to keep in-force, which is generally higher than the premium for term life. But in return, permanent policies will accumulate a cash value, which is often tax deferred. Under most circumstances, you can borrow against the policy value.

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