How life insurance can be a retirement investment

Most people think of life insurance as a means of paying for final expenses; however, it can be used for more than that.

Here are some of the top reasons why life insurance can be the versatile retirement investment that you should have as part of your portfolio.

The cash value of whole life

Whole life insurance policies earn cash value over their course. When you purchase a whole life insurance policy, it provides you with a lump sum payment that would be available upon your death.

Many people purchase term life insurance policies, because the payouts are larger and the costs are lower. However, these policies cease at a certain age. If you outlive the date on the policy, all the money paid into the policy is lost.

By contrast, whole life insurance policies continue as long as the premiums are paid. When you have put in a certain percentage of the total payout, the policy begins to earn cash value. This allows you to borrow against the policy in the case of an emergency. You can use this cash value to pay your premiums, so that when you retire, you won’t have a bill but will still receive the coverage.

Single premium life Insurance

Single premium life insurance policies are purchased with a lump sum. You pay a lump sum up front and receive a higher amount for your final expenses. For example, you may put a sum of $10,000 into the policy, and receive $27,000 in life insurance coverage.

Deferred taxes

Money in an insurance policy will grow without being taxed. Untaxed amounts will grow faster than taxed investments, making your money grow faster. If you need to take out a loan against the cash value of a policy, you will be able to do so faster than many other investment vehicles.

Life insurance is an important way to prepare for the future. It will not only provide income for your family in the case of your untimely death, but it will provide a backup income for emergencies. You can choose the policy that is right for you and your family’s needs.

John B. Wright has the experience to evaluate your life insurance needs. We will help you make sure you and your family are well covered. For more information on life insurance options call 800-224-6693 or fill out the contact form on our website here.