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What Is Indexed Universal Life Insurance?

What Is Indexed Universal Life Insurance?

A better way to save for retirement is to obtain Indexed Universal life insurance. This type of policy is a type of Universal Life insurance. This type of insurance policy allows you to allocate a cash value to either an equity index account or a fixed account. It also offers tax-deferred cash accumulation for your retirement while still offering and maintaining a death benefit.


The way it works is that the cash value in the policy will earn interest based on the increase of either an equity or a bond index (or even a combination of both). This allows you to earn interest on the policy based on the movement of an external index like the stock market. So with this in mind, policyholders can earn more interest over time for their retirement instead of earning it at a fixed rate.


The reason why Indexed Universal Life Insurance is great for retirement is because it allows you to take advantage of market gains without having to risk anything if the market decreases. If the market goes down, you won’t have to worry about your money taking a hit because as a policyholder, your cash value won’t decrease because of that market loss.


Another great thing about having an Indexed Universal Life Insurance is that you not only get to save money for your retirement due to the cash value part of the policy, but if something happens to you, your family will receive the death benefit of the life insurance policy without having to pay any federal income taxes on it.


Why Is Indexed Universal Life Insurance Important For A Tax-Free Retirement?

Tax-free anything is always great and that’s the biggest benefit of an Indexed Universal Life Insurance policy. You can access the money in your cash value without having it taken away for taxes, providing you more money for your retirement days. Plus, the policy loan (and any interest if there’s any) won’t have to be paid back just as long as you continue paying the premium. But if the policy loan isn’t repaid, that unpaid loan balance will just get deducted from the death benefit when you die. Then your family will get the funds that are left from the policy.


If tax-free retirement planning is giving you a headache, Buckalew Financial Services can help to break it down, so that the information is easier to understand. Find out how you can set up a tax-free retirement plan by simplifying contacting us. We can help you find a policy that will fit your budget and income needs as well as your retirement plans.

What Is Indexed Universal Life Insurance?

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