You’ve worked hard and dedicated all your resources to build and grow your business into a successful enterprise. When the time comes to move on to the next chapter in your life, will you be prepared?
Retirement planning is about creating a strategy that helps ensure the lifestyle you've grown accustomed to will continue long after you retire. Careful preparation today can help make this important phase of your life a reality tomorrow.
Life insurance can be a key component in a diversified retirement planning strategy. As a small business owner, you may be limited in your qualified retirement planning options. Life insurance can provide an alternative to supplement the retirement funding vehicles you already have in place.
Life insurance pays a death benefit, generally income-tax free, to a beneficiary upon the death of the insured. In addition, life insurance can accumulate a cash value on a tax-deferred basis. This cash value can be accessed for a variety of life's opportunities and challenges, including supplemental retirement income.1
Term life insurance provides coverage for a set period of time at a generally lower cost than permanent insurance. Many term life insurance products allow you to convert to a permanent policy, such as whole life insurance. The cost of insuring oneself increases over time, so it’s important to understand your short- and long-term needs for financial security when you select a policy.
Permanent life insurance provides you with financial protection for your entire life, as long as the policy remains in force. Because of the flexibility permanent life insurance offers, there are several types of policies you can purchase.Permanent life insurance provides you with financial protection for your entire life, as long as the policy remains in force. Because of the flexibility permanent life insurance offers, there are several types of policies you can purchase.
1 Distributions under the policy (including cash dividends and partial/full surrenders) are not subject to taxation up to the amount paid into the policy (the cost basis). If the policy is a Modified Endowment Contract, policy loans and/or distributions are taxable to the extent of gain and are subject to a 10% tax penalty. Access to cash values through borrowing or partial surrenders can reduce the policy's cash value and death benefit, increase the chance the policy will lapse, and may result in a tax liability if the policy terminates before the death of the insured.
2 Guarantees are based on the claims paying ability of the issuing company or companies.