Life Insurance

IUL’s Use a Stock Market Index To Determine Cash Value Growth

Life Insurance in Retirement

The main purpose of life insurance is to protect those we love after we pass on.  However, it can serve many other purposes besides providing a death benefit, especially if your policy is an indexed universal life (IUL) policy.  Besides providing income in the event of an unexpected death, it can provide tax-free retirement income. Plus, the cash value can also be used to buffer the market against volatility. Many retirees choose IULs for life insurance in retirement because of their benefits.

Using IULs in Retirement Strategy

Utilizing life insurance in retirement may be a good option depending on your situation. A key reason for this is the tax-free* income benefits of an IUL. Since IULs are insurance policies, your money invested in them is subject to different tax laws.

If you have traditional IRAs or 401(k)’s, for example, you pay taxes on your withdrawals. You’ll also need to pay taxes when you reach a certain age. This is referred to as a Required Minimum Distribution (RMD). In this case, an IUL may be of interest to you. IULs do not have RMDs and are sometimes used to gradually transfer money from retirement accounts. This could enable you to earn tax-free* income.

couple sitting at kitchen table working on laptop and researchign life insurance in retirement warwick ri

Choosing The Right Life Insurance in Retirement

senior couple walking the beach with their grandkids and dog life insurance in retirement life warwick ri
How do you determine the right policy for your specific needs during retirement?
Retirement specialists can help you sort through your options, apply for the right product, and guide you through the entire process.

Your financial goals change when you reach or approach retirement. Most retirees begin to look for ways to protect their money instead of risking it on the stock market. Life insurance goals may also change during retirement.

Maintaining your family’s protection is still a priority. Tax implications associated with retirement may affect your initial strategy. Therefore, choosing life insurance in retirement that fits your needs become increasingly important. Our specialist at GPS Retirement can help you explore options to protecting your money and your loved ones. IUL policies can help you attain both of those goals.

Retirement Benefits Of Life Insurance

Here are some benefits that you may be able to access with IULs:

  • A method of accumulating funds.
  • Tax-deferred growth is not subject to market volatility.
  • Option to make tax-deferred distributions.
  • Cash value growth based on a stock market index
  • Potential to lock in gains
  • A wide range of index options
  • You can access both the principal and potential interest
  • Earn income tax-free.
  • No penalties for early withdrawals

IUL Benefits Beyond Your Lifetime

Your loved ones can receive the following benefits after you pass away:

  • There is less premium paid than the death benefit
  • A tax-free death benefit*
  • Payments to beneficiaries without probate
  • Paying a beneficiary all at once or in installments
  • Death benefits may increase over time
  • Option to accelerate a portion of the death benefit for terminal or chronic illness

Contact our team at GPS Retirement to discuss options available to fit your situation.

We also offer monthly educational retirement seminars in-person or online. Call or register for an upcoming seminar.

Scroll to Top