Life Insurance Houston
How have life insurance strategies evolved?
For retirees, life insurance is a sound investment for many reasons. Today’s life insurance policies can be a valuable protective tool with respect to retirement planning, business planning and estate planning. Traditionally, life insurance policies have been designed to protect and provide for your loved ones in the event of your death so they could maintain the same quality of life they enjoyed while you were living. Happily, life insurance strategies have evolved tremendously in the past few years and now offer what are known as “Living Benefits.” Innovative new life insurance strategies can provide a variety of enhanced benefits during your life, for your business as well as your estate.
What are some of the exciting Living Benefits available with today’s life insurance policies?
- Life insurance strategies available today offer long term care protection, such as assisted living and in-home healthcare expenses.
- New life insurance policies offer strong potential to grow the cash value of your policy.
- A life insurance policy can also act as a savings account in some instances, which can be withdrawn or borrowed at your request.
- Life insurance can also be used as an important business planning tool. This type of life insurance is designed to protect your business in the event of the death or disability of a key person whose loss could potentially cause the business financial hardship.
- Life insurance strategies can also be used as a means to incentivize your executives or key employees to continue working for your company opposed to your competitors. Click employee retention planning for more information on this topic.
- With the correct structure, life insurance premiums can be tax-deductible to the corporation.
Of course, life insurance will also protect your loved ones from financial devastation in the event of your death. Having an insurance policy will not only supplement any income loss that may interfere with your family’s current quality of life, it will also pay for any lingering debts and medical bills that could contribute to the financial burden on your family at the time of your death.
What are some of the more traditional benefits life insurance can offer?
- We can likely find you a higher death benefit than you currently have in your existing life insurance policy—often with a lower cost. It doesn’t matter if you’re 40 or 70.
- Life insurance can offer tax-free income for your heirs.
- Life insurance can be left as lump sum inheritance to your heirs, even if you have no other assets at time of death.
- A life insurance policy can also pay for any estate taxes so loved ones do not have to sell the business or other assets to cover tax payments.
- Life insurance can also be used to make a planned donation to your favorite charities or your local church in your name at the time of your death.
- Life insurance can be used for wealth transfer.
When is the best time to consider purchasing a life insurance policy?
Life insurance provides peace of mind for your family, your business and yourself. There are many stages of life where the consideration of purchasing a life insurance policy is appropriate:
- After saying “I do”: Marriage is a commitment both emotionally and financially. Purchasing a life insurance policy on each other can offer protection to you and your spouse. Remember, the untimely death of a husband or wife means the surviving spouse would be under financial strain to pay the mortgage, rent, credit card debts, or funeral expenses on a single income. Purchasing a modest amount of life insurance can often cover these financial burdens.
- The birth of your first child: Parenthood is a lifetime responsibility. At this stage in your life, life insurance becomes a priority. If something were to happen to you or your spouse, who would provide care for your child? The loss of one or both incomes would be devastating to the future of your child. Purchasing a life insurance policy on yourself and your spouse can guarantee that both the surviving spouse and child are financially secure.
- You own a business or you’re a key executive of a business: Often, the financial solvency of a business is dependent on one person or several key executives. If your business were to suffer the loss of a key executive due to death or disability, the appropriate business planning life insurance strategies will offset the monetary loss to the company and also the replacement cost of the deceased or disabled.
- You have loans or lines of credit at your business: Read the fine print! If you or a key person is disabled, arrested, or passes away, don’t expect your bank to be understanding and patient. All loans have the above trigger clauses and you can wind up having your loan immediately called. If you can’t pay it off, the bank can force you to sell assets to raise cash. If you don’t have the money to pay, most banks have the right to take the money right out of your accounts … they can even seize receivables! A simple life insurance strategy can avoid this potential devastation, while sometimes lowering the interest rate on your loan or line of credit.
- The golden years: In your working years you’ve made sacrifices to accumulate your nest egg. The time has come to enjoy a comfortable retirement. One way to protect your nest egg and avoid the possibility of financial strain on your spouse or children is to purchase a life insurance policy that includes living benefits. There is a good chance that you and your spouse will live well into your late eighties. It is important to have a protection plan to pay for some of the medical expenses you may incur as a result of living longer. Purchasing a life insurance policy with the appropriate living benefits will cover long term care expenses like in-home health and nursing home expenses. Today’s life insurance protection is designed as much for the living insured as it is for those dependent on the insured.
- Estate Planning: As it relates to estate planning, life insurance will also alleviate the financial hardship of paying an estate tax. In many cases, executors must sell the decedent’s business to pay the estate taxes due—which a proper life insurance policy can help you avoid. Also, if you have more than one relative as your beneficiary they might have plans separate from one another when it comes to running or selling that business. If one relative wishes to manage the business and the other wishes to sell it, then life insurance can be used for Estate Equalization so that each party receives their share. This strategy is often in employed when one child has a desire to run the business and the others do not.
Of course, life insurance can also be used for transferring assets tax-free, paying estate taxes due, and avoiding the double tax-trap on IRA’s.
With so many types of life insurance how can I choose the best life policy fit for my family or business?
Understanding your unique needs is key. As the stages of your life change, so will your life insurance needs. It is important to talk to a life insurance expert to become educated on which strategies are most appropriate for your situation. Having your existing life insurance policy reviewed is crucial for those in or approaching retirement as your current life insurance policy may be outdated and/or lacking some valuable living benefits. Also consider that in retirement, estate planning becomes a priority.
As for business planning, there are many options to choose from that can improve your security, profitability, and business continuity. Most business owners simply aren’t aware that most of these choices even exist. This is why education is necessary and contacting an Oak Harvest representative is your first step. Click here to contact Oak Harvest.
How can I have my current life insurance policy reviewed?
It is vital to have any existing life insurance policies reviewed in detail by a licensed life insurance professional. If you bring in your policy and most recent statement, we will be able to provide a complimentary review.
The combination of 2 things is driving the value in today’s policies:
- We are all living much longer lives
- Life insurance companies are competing for the 10,000 baby boomers that are retiring daily for the next 18 years.
These two factors are the primary cause for the innovation and value provided by today’s life insurance policies. Oak Harvest may be able to reduce or eliminate your annual cost, increase your death benefit, or both.
Schedule your complimentary life insurance review with an Oak Harvest Financial Group retirement specialist by clicking here.