Tuesday, March 3, 2015

Why life insurance can be an option to a 401(k) - Life Insurance Income Strategies



Qualified plans can be an excellent tax-deductible way to save for retirement, especially if your employer matches your contributions and/or you're in a high effective tax bracket. But another option to a qualified plan, like a 401(k), is cash value life insurance, especially if the employer doesn't offer a contribution match or if you're in a low effective tax bracket. Social Security benefit taxation is another consideration in selecting between a qualified plan like a 401(k) and a non qualified cash value life insurance policy, which is not deductible.

At retirement 401(k) plan distributions are taxed at ordinary income tax rates and are includable as income for determining whether Social Security benefits are taxed. These are just a few of the considerations in determining whether to use a qualified or non-qualified plan and what financial products you should use to fund your plan.

Syndicated financial columnist and talk show host Steve Savant interviews life insurance income specialist Don Prehn, CLU, ChFC. For over 20 years Don has been presenting cash value life insurance as a financial product option. This is episode 2 of 5 in the series, Life Insurance Income Strategies.

About Steve Savant

Steve Savant

As the National Marketing Spokesperson for Ash Brokerage, Steve Savant looks forward to meeting financial professionals in every way possible - in person or by video through conferences and social media.

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