When most people think about purchasing life insurance, they see it as an expense. But life insurance is not just a “just in case I die” insurance expense for death benefit protection—it’s an asset that provides many other valuable benefits. Imagine having an insurance policy that could help pay for your child’s college education, provide tax-free income in retirement, or can be sold for more than its cash value.
5 key benefits that show how a life insurance policy is an asset:
1. Life Insurance Provides a Death Benefit
The primary purpose of a life insurance policy is to provide cash to your loved ones in the event of your death. This cash can help cover final expenses, pay off debts and mortgages, and replace lost income. Imagine the peace of mind you’ll have knowing that your family is taken care of financially when (not if) you die.
2. Life Insurance Provides Tax-Free Retirement Income
With a cash value life insurance policy, you can create a tax-free retirement income stream. This means that your policy’s cash value grows tax-deferred and you can withdraw money from the cash value tax-free and penalty-free (via premium withdrawals and policy loans) in retirement, even if you are younger than age 59 ½. This can be a valuable source of income, especially if you are in a high-income tax bracket.
3. Life Insurance Provides Safe and Consistent Savings Growth
Life insurance policies offer a safe and consistent way to grow your savings. Your cash value can grow at a guaranteed rate, as well as through non-guaranteed dividends and stock market gains, all with protection against market losses and economic downturns so you will never have to worry about losing money. And, you can access your cash value at any time and for any reason without tax penalties – making it a flexible and convenient way to save money.
4. Life Insurance Provides a College Savings Plan
Cash value life Insurance policies such as whole life and universal life can also be used as a college savings plan. They offer a tax-advantaged way to save for education expenses. The money in the policy grows tax-deferred, and withdrawals for your child’s education expenses are not taxed.
5. Life Insurance Provides a Life Settlement Option
A life insurance policy can also be used as a life settlement option. If you no longer need the death benefit protection, you can sell the policy in the secondary market for a lump sum of cash. This can be a valuable source of income in retirement when you may need it the most.
Life Insurance is an Asset
As you can see, a life insurance policy is much more than just a death benefit. It’s an asset that can provide you and your family with financial security and peace of mind. If you don’t have life insurance, now is the time to get it. It’s one of the best financial decisions you can make for your family’s future. Contact us today to learn more about how life insurance policies can be a lifelong asset to you and your loved ones.
