Whole Life Insurance

 Protect your Assets while you Create One                                                      July 19, 2013

 Jon Glougie, CFP®, Investment Advisor, Insurance Advisor

What if you could protect your assets as you accumulate them, while at the same time, you could create another source of retirement income?

A common dilemma for most people is determining how much you should allocate monthly to insurance and how much you should allocate to your savings/investments. With one Whole Life Insurance premium you can do both.

Whole Life Insurance is life insurance, make no mistake about it. It will pay a tax-free death benefit to your beneficiary(ies) if you pass away. You make monthly premium payments, however, rather than your monthly premium exclusively covering the pure cost of insurance, a portion of your premium gets invested in a savings account, sheltered within the policy. Your monthly premium will provide you with both life insurance (to protect your assets) and savings (to accumulate tax-free and provide you with a potential source of income in retirement).

Life Insurance… Whole Life Insurance has a guaranteed death benefit. It has guaranteed premiums. You even have the opportunity to pay for your insurance early. For example, you can have your life insurance paid for in full within 15 or 20 years… yet the coverage will last you a life time.

Savings… with a Whole Life Insurance policy you can accumulate investment assets free of any annual income tax. As you make your monthly premium payments, you will be accumulating your savings and investing them within the policy… at guaranteed interest rates!!! This side savings account is commonly known as your Cash Value.

Retirement Income… When you retire, you can use the money in your Cash Value to provide yourself with a source of monthly retirement income. You can take the money out of your Cash Value directly, or you can take the money from your Cash Value in the form of a policy loan. Either way, the money in your Cash Value will have grown tax-sheltered, at guaranteed interest rates.

This strategy may not be for everybody, but it may be for you. If you would like find out if and how Whole Life Insurance can work for you within your financial plan, just let us know. We’d be happy to help.


*Insurance products provided through Dundee Insurance Agency Ltd.