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The Magnificent 10: No.7 - Love your Retirement!




So when you are DONE... done raising kids, done building a career, done growing a business and it's all about you, what do you want your life to look like?

 

You will have to take steps NOW to create that future!

 

As we think of and design the life we want to live, we have to also design the finances to support it.

 

A few biggie questions to consider are:

  • How long will my money last?

  • How much taxes will I pay?

 

No matter your investment assets of choice to grow wealth - real estate, stocks, businesses - a must have is cash value life insurance as the secure foundation on which its all built on.

 

Permanent insurance, such as whole life or universal life, offers a unique set of features that can enhance your retirement strategy. Remember that cash value, that can grow over time tax-exempt? Well, retirement is a good time to leverage it. At retirement, you can access this cash value in multiple ways - withdrawal, policy loan or collateral loan. The first two mentioned will have certain tax consequences. The latter however, offers tax free access to the cash to provide a tax efficient income stream all the way to your last breath. One answer to both questions!

 

By using the collateral loan strategy, the life insurance policy is assigned to a third party lending institution. The lending institution uses the cash value of the policy as security for a loan. The borrowed funds go to you as desired, triggering no taxes or government benefit clawbacks. You are free to use the funds as you choose. The loans and interest is eventually paid off by the policy insurance death benefit proceeds and the excess goes to your beneficiaries tax-free! Sweet, right?!

 

Of course, like any other retirement strategy, do your due diligence in regards to associated risks including life expectancy, interest rates, market performance, and the like.

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