What is an Insured Retirement Plan?

Our insured retirement plan allows you to protect your future and retire confidently, and protects you from unexpected events.

Insured retirement plans are financial planning tools that combine a life insurance policy with an investment component. These plans can be used to provide a stream of income during retirement, while also offering the potential for tax benefits and other advantages.

 

Some of the key benefits of insured retirement plans may include:

 

Potential tax advantages: Depending on the type of insured retirement plan you have, you may be able to contribute money on a pre-tax basis, which can lower your overall tax bill. In addition, the investment portion of an insured retirement plan may offer tax-deferred growth, which means that you won't have to pay taxes on any investment earnings until you begin to withdraw them.

 

Potential for income during retirement: Insured retirement plans can be used to provide a stream of income during retirement, which can be particularly valuable for individuals who are concerned about outliving their savings or who want to supplement other sources of retirement income.

 

Death benefit protection: Many insured retirement plans include a death benefit, which can provide financial protection for your loved ones in the event of your premature death. The death benefit can be used to pay off outstanding debts, provide financial support for loved ones, or meet other needs. It's not uncommon for life insurance policies to offer profit-sharing plans as an additional benefit. In this case, profit sharing refers to a feature that allows policyholders to share in the profits of the insurance company. This may be done through the payment of dividends to policyholders, or through other means, such as credits that can be used to reduce premiums or increase the death benefit of the policy.



Flexibility: Insured retirement plans can be customized to meet your specific financial goals and needs. For example, you can choose the number of your contributions, the investments you make, and the type of payout option you prefer.

 

Potential for charitable giving: Some insured retirement plans include a charitable remainder trust (CRT), which can be used to make charitable donations while also receiving a stream of income for life. A CRT can be a tax-efficient way to make charitable gifts, as you may be able to claim a charitable deduction for the value of the remainder interest in the trust.

 

It's important to note that the specific benefits and features of an insured retirement plan can vary depending on the type of plan you have and the insurer that issued it. It's a good idea to carefully review the terms and conditions of your plan and consult with a financial professional or a tax advisor to understand how the plan works and how it may impact your taxes.

 

Here are a few tax strategies that might be used in connection with an insured retirement plan:

 

Contribute pre-tax dollars: Depending on the type of insured retirement plan you have, you may be able to contribute money on a pre-tax basis. This means that you can deduct the contributions you make to the plan from your taxable income, which can lower your overall tax bill.

 

Take advantage of tax-deferred growth: The investment portion of an insured retirement plan may offer tax-deferred growth, which means that you won't have to pay taxes on any investment earnings until you begin to withdraw them. This can allow your money to compound over time and potentially grow more than it would in a taxable investment account.

 

Use the death benefit to your advantage: If you have an insured retirement plan that includes a death benefit, you may be able to use this feature to your advantage for tax planning purposes. For example, you might use the death benefit to pay off any outstanding debts or to provide financial support for loved ones after you pass away.

 

Consider a charitable remainder trust: If you have an insured retirement plan that includes a charitable remainder trust (CRT), you may be able to use the CRT to make charitable donations while also receiving a stream of income for life. A CRT can be a tax-efficient way to make charitable gifts, as you may be able to claim a charitable deduction for the value of the remainder interest in the trust.



How insured retirement plans are designed?

 

Retirement plans are typically designed by retirement plan specialists or organizations to provide a way for employees or members to save for retirement. The retirement plan design can have a significant impact on the plan's effectiveness, as well as on the tax benefits and other incentives it offers to participants.

 

There are many different factors that can go into the retirement plan design, including the size and financial stability of the employer, the demographics and needs of the employees, the types of contributions that will be made to the plan, and the investment options that will be available.

 

In many cases, the employer will work with a financial professional or a retirement plan consultant to design the plan. These advisors can help the employer understand the various options that are available and choose the retirement plan design that best meets the needs of the company and its employees.

 

It's worth noting that the specific rules and regulations that apply to retirement plans can vary depending on the type of plan and the jurisdiction in which it is offered. Employers should be sure to consult with a financial professional or a tax advisor to understand the requirements and obligations that apply to the plan they are considering.

 

"Get the best of both worlds - protection and potential income - with an insured retirement plan."