Comparing Apples To Oranges? Almost!

Comparing Apples To Oranges? Almost!

A man in Clearwater, FL, claimed to have grown a grapefruit that looked exactly like an orange – except that it was bigger and yellow.  The attempt at comparison is understandable given other features characteristic of both.

What If Clients:

1) Don’t have access to a qualified retirement plan, or
2) Have maxed out on the qualified plan they have, or
3) Are looking for a non-qualified benefit plan for themselves, key employees or others.

Although qualified plans and universal life policies are fruits of a different color, they still look a lot alike when used to provide funds for retirement.

Compare And Consider:
Standard Qualified Plan Universal Life Insurance
Unrestricted Contributions No Yes
Contributions Deductible Yes No
Tax-Deferred Growth Within Yes Yes
Nontaxable “Cost of Insurance”

No (Must report economic benefit for coverage under the plan)

Yes (COIs are paid internally with untaxed returns on the cash value)

Uninterrupted Accumulation After Age 70-1/2 No Yes
Non-Taxable Withdrawal of Funds No Yes (Non-MEC FIFO withdrawals and loans)
Early Withdrawals Free of Penalties No

Yes (Assuming a non-MEC contract outside the surrender charge period)

Call today for a ledger illustrating an over-funded UL product that demonstrates an attractive withdrawal strategy during your client’s retirement years to supplement their retirement income from other sources.

Remember:  The biggest asset your clients may have available for their retirement planning could be their insurability!