Cash Value Life Insurance designed as a Non Modified Endowment Contract (non MEC) can generate tax-free collateralized policy loans and withdrawal of basis tax-free as long as the policy is kept in force for the life of the policy insured. Therefore cash value life insurance in this scenario is a life-long buy and hold position, beyond the traditional long-term horizon timeline. There are four types of cash value policies to choose from based on your risk tolerance and product suitability for your financial goals: Participating Whole life, Universal Life, Indexed Universal Life and Variable Universal Life. The crediting methods for each policy type have advantages and drawbacks. You should seek out an insurance professional who understands the rules of engagement to generate tax- free income from these types of cash value polices.
Home Equity Conversion Mortgage (HECM) is an FHA insured HUD program for seniors over age 62. HECM has several options to choose from in using home equity. One of those options is tax-free income from collateralized equity loans from your home, which can generate a lump sum or an annual payout. The payout schedule can be for a limited time as an income strategy to delay Social Security benefits to age 70 to maximize its income. By generating tax-free income from a “reverse mortgage” between ages 62 and 70, you can still work without infringing on your Social Security benefits. The payout schedule can also be designed for lifetime tax-free income.
Cash Value Life Insurance and Home Equity Conversion Mortgage (HECM) are excellent funding vehicles to design a tax-free retirement plan.
Most people have a predisposition about risk. It’s generally environmental and based on family upbringing. That doesn’t mean it’s necessarily right, it’s just where you are, depending upon your financial literacy. Whether you know it or not, you ...
Released On: 12/27/2019
Views: 1881
There are mortality averages based on actuarial statistics that can approximate the life expectancy of the general population at large. But “averages” don’t address half of those who will exceed the norms. The more data you put into determining y ...
Released On: 12/26/2019
Views: 1833
For most wage earners and retirees taxes are the biggest expense they’ll ever have over their lifetime. Managing your tax bill effectively is learning to become a “gamer,” by avoiding tax traps and snares along life’s journey. You have to know th ...
Released On: 12/25/2019
Views: 1749
It’s rather stunning to discover that most baby boomers have never had a budget in their life, but they’re going to need one in retirement. Retirement may be the biggest motivator for most Americans to create a budget because retirees live month ...
Released On: 12/24/2019
Views: 1853
Life just happens, but there are predictable events common to most in our culture and most of those events have a financial impact. Planning for those predictable events can prepare you to meet many of these obligations. The life event checklist ...
Released On: 12/23/2019
Views: 1919
The Mortality Revolution may very well be the final frontier in mankind’s quest to beat death. So far, the grim reaper has won every time, but new timelines are emerging in human longevity that are delaying the inevitable. Prepare yourself for l ...
Released On: 12/20/2019
Views: 1751
Living longer is exacerbating over a dozen other retirement risks that threaten the vast majority of retirees and those near retirement. If the status quo continues, the retirement lifestyle of most seniors will be severely pared back. Watch the ...
Released On: 12/19/2019
Views: 1794
Most of the retirement plans currently operational have a significant flaw. They’ve grossly underestimated the increase in life expectancy over the last generation. But government and military pensions are in the greater financial jeopardy, becau ...
Released On: 12/18/2019
Views: 1765
The law of large numbers and changing demographics of life expectancy is having a significant impact on guaranteed lifetime annuities. Annuity manufacturers are touting their alpha with mortality credits and receiving newfound interest among fina ...
Released On: 12/17/2019
Views: 1783
The last 100 years have seen a significant increase in human longevity compared to the earliest records of mankind. The spike in longevity has caught the Western world by surprise. The effects of this revolution are affecting financial planning a ...
Released On: 12/16/2019
Views: 1737
There was a time when Social Security benefits were not exposed to ordinary income taxation. But over the years, small incremental steps were taken to tax the benefits. Maybe “means testing” may be implemented to shore up the vulnerable Social Se ...
Released On: 12/13/2019
Views: 1428
Collateralized loans are not characterized as income and are not reportable, as such, on your 1040 form. And because these loans are not forms of taxable income, they are not counted for the provisional income test for Social Security taxation. W ...
Released On: 12/12/2019
Views: 1897
Retirement, as it is today, is inherently crippled by taxes. You may very well have one million dollars in your retirement plan, but Uncle Sam may own up to 40% of it. Health Savings Accounts (HSA) and Roth IRAs need to be reconsidered as a first ...
Released On: 12/11/2019
Views: 1700
Most American workers don’t comprehend the realities of retirement until they’re a few years from retirement date, which is often too late. They’re just too busy dealing with immediate financial pressures to understand the long-haul consequences ...
Released On: 12/10/2019
Views: 1730
Retirement will undergo a drastic reinvention as the newest generation redefines it's golden years in their investment habits and senior lifestyle goals. https://www.youtube.com/watch?v=RAdtMWBaseY&feature=youtu.be
Released On: 12/9/2019
Views: 1689
Your retirement account is only as big as your tax planning strategy. Your personal exemptions and standard deductions in retirement will not be enough to offset your tax bill. Tax management must be a major component of your retirement plan. Wat ...
Released On: 12/6/2019
Views: 1796
If you have longevity in your family, guaranteed income for life is a must consideration. If you think it’s reasonable that medical advances will impact your longevity, then guaranteed income for life may need to be in your retirement plan. Watch ...
Released On: 12/5/2019
Views: 1651
A happy retirement is based on math and science, not on wishful thinking and hoping things turn out right. You need to eliminate debt and risk in retirement and secure reliable income to generate the peace of mind that seniors desire in their gol ...
Released On: 12/4/2019
Views: 1397