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Life
insurance is really a classic example of
"leverage". For a small amount of money, we
"rent" the use of a large amount of money if
certain conditions come to pass. It also enjoys an almost
unique position in our tax structure.
Life
Insurance is really the only large asset to which most of us
will ever have access that can grow on a compounding basis TAX
FREE as long as the policy is in force, be
borrowed against INCOME TAX FREE, and still builds a pot of
money that passes to your heirs INCOME TAX FREE, if
it is cash-value Life Insurance.
Term
life insurance is primarily designed to provide income
to replace the breadwinner until the dependents are grown;
it is not designed to be an investment or savings vehicle.
Cash-value
life insurance, properly used, can function both as a
vehicle to protect your family and/or your business, and
still be a safe, and profitable, investment strategy. This
is particularly true when many other investments are at
risk.
Which
is better for you at any particular time depends on your
personal and business needs, your life strategy, and your
goals. However, the old idea of "death
insurance" is very far from reality in the modern
financial world. Most modern life
insurance policies are true investment vehicles, and
with two distinct and important advantages over most
investment vehicles: When properly constructed,
cash-value life insurance grows tax-deferred, and can be
distributed in several ways income-tax free. This allows not
only for faster growth in the accumulation phase of the
asset, but more "spending power" in the
distribution phase. In these respects, no other
financial vehicle works as well. For more
information, call or email us. We can help. |
