You’ve heard all about the college pre-paid’s and other such accounts.

There is a lot to learn about 529’s, UGMA’s, UTMA’s, or even how to utilize an IRA for college planning. Yep, they can all be used. But, what you may not know (and don’t take our word for it, ask a CPA) is 100% of the money in a minors name is counted against them when they complete a FAFSA, and 50% of the guardians. Yep. That can sting if it is too late. But, if it is not, we have a GREAT idea for you.

The cash value inside a life policy, though, is outside the government’s purview.

INDEXED WHOLE LIFE INSURANCE

Where future planning meets indexed whole life insurance

  • Life insurance provides a tax-free death benefit many times the size of the annual premium. It’s a difficult thing to consider, but not everyone gets to see the future they planned. Life insurance can’t replace you, but it can provide the funding to ensure that your plans come to fruition and deliver the benefits to your loved ones just as you would have done. You can even purchase an optional waiver of premium rider to protect this plan from a possible disability occurring to you, thereby providing additional protection.

  • When you own an IWL policy your premiums ultimately wind up in accounts linked to market indices. These accounts come with a floor of 0% asset performance which protects you from steep market downturns.3 In order to provide this floor there is also a cap to the amount that can be earned inside the account. Oftentimes this can be thought of as downside protection with upside potential.

  • While many people are eligible to fund Roth IRAs, there are limits based upon income. There are also limits based on how much that can be contributed annually. A life insurance policy can be purchased, provided you’re healthy, irrespective of how much you earn. And the only limiting factor on your premium size is the amount of death benefit purchased. Please note, that unlike a Roth IRA, your life insurance policy is a long-term commitment with premium requirements for ten years.1

  • IWL policies provide you with a variety of ways to access the money inside the policy. Working with your financial professional you can determine which one makes the most sense for you. You may even have the option to change the mode of distribution depending on your risk tolerances or the economic environment. What you get is flexibility in how you access your asset, and that’s a good thing.