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New Solutions For Life’s Uncertainties

Posted August 01, 2012 in Advice Column, Perry

Life is full of uncertainties, but your retirement shouldn’t be one of them.

While you can’t control taxes or predict market fluctuations, one solution may be the flexibility, guarantees and tax advantages of a universal life insurance policy. Properly managed, it can provide a future source of retirement income you can depend on.

 Increasing taxes. Taxes continue to be on the rise, so it’s wise to look for ways to retain as much of your money as possible. By doing so, you can maximize funds for the future.

Solution: As you pay premiums, your universal life policy’s accumulated value earns tax-deferred interest, helping build your nest egg during pre-retirement years. When you decide to retire, you can use your accumulated value as retirement income in a tax-advantaged manner. And upon your death, your beneficiaries will receive policy proceeds income-tax-free.

    Uncertainty of Social Security. The future of Social Security is unclear, so it’s difficult to predict what, if any, retirement income you can count on. Taking control of your financial future now is more important than ever.

 Solution: You can contribute additional funds to your policy’s accumulated value that can be used as supplementary retirement income. In fact, our universal life product compares favorably, over the long term, with other universal life products on the market today.

    Comfortable retirement. Your annual income may disqualify you from contributing to a qualified plan, such as a Roth IRA, thus making it difficult for you to put additional money away for the future.

Solution: There are no annual income limits that would prevent you from contributing to the accumulated value of your Universal Life policy. You pay any amount at any time within the maximum limit set by tax law, provided your premium is sufficient to maintain your coverage.

   Market volatility. Due to the volatility of the stock market in the past few years, your preference today may be for more stability and preservation of your principal.

Solution: Market volatility does not directly impact universal life. As you pay premiums, the money in your policy’s accumulated value currently earns a competitive interest rate — of 5.4 percent — with a 3 percent guaranteed minimum rate.

Flexibility to make changes. As your life changes or you experience unexpected events, you need to be able to adjust your coverage and premium amounts as necessary.

Solution: With universal life, you can increase or decrease your coverage as your needs change throughout your life, and adjust the amount and timing of your premiums. In addition, you can access your policy’s accumulated value through partial withdrawals and loans if you need additional funds.

Contact your agent to determine if universal life insurance is the right choice for you.
Information provided by David Finneseth, agent, Farm Bureau Financial Services, 1009 Willis Ave., 515-465-2005;

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