How Indexed Universal Life Insurance Can Work for You
Buying life insurance surely rises to the top when you make a list of things you can do to protect your family’s future. The reason is simple: Buying life insurance helps you financially support the people you love after you’re gone. That support can help make up for the loss of income, and it can allow your family to continue to live the lifestyle they’re familiar with – exactly what you’re looking for. But what if life insurance could do that, plus help your plan for retirement? That’s where indexed universal life insurance (IUL) comes in.
The Basics on Indexed Universal Life Insurance
There are several types of insurance, all designed to provide a death benefit. Some, like indexed universal life, provide additional features.
Many people are familiar with term life insurance, which provides coverage for a specific range of time, such as 10, 20 or 30 years. And there’s whole life, which provides permanent coverage while building cash value. Meanwhile, indexed universal life is similar to whole life, but with more flexibility and opportunity for growth.
Like a whole life policy, it’s permanent coverage, and part of your indexed universal life premium will pay the cost of insurance and any expenses related to the certificate – while the rest can be used to accumulate cash value. However, there is a key difference many consumers want: flexibility and the opportunity for greater cash value growth linked to an index.
Indexed universal life’s flexibility lets you determine how you pay your premiums, whether in a lump sum or regular monthly payments. You can even adjust those payments up or down as the need arises1.
Taking advantage of a bullish stock market without worrying about losing money due to market losses is another thing that makes indexed universal life attractive to many people. Add in the advantage of protecting your loved ones with the death benefit, and you have a winning combination.
What Makes My Choice IULTM a Good Choice for You?
If indexed universal life seems to fit your needs, then look at WoodmenLife’s My Choice IUL. This product provides your beneficiaries with a death benefit and you the ability to build potential cash value over time.
The powerful combination of insurance and retirement planning helps address a basic concern shared by families – financial protection – no matter where they are in life. My Choice IUL could be a great fit for you, regardless of the stage of life you’re in:
- Make the Right Start: Whether you’re beginning a career or a family, you have the ability to take on risk and the potential to grow your funds at a higher rate – providing long-term potential for cash value growth. You also may qualify for lower life insurance premiums, as life insurance tends to be less expensive at a younger age.
- Get on the Right Path: If you see retirement on the horizon, you want to ensure your family is protected but still have the ability to build potential cash value that could be used to supplement your retirement or accessed when you need it2. You will also have the flexibility to change allocations between the fixed and indexed accounts3 to help meet your retirement goals, or you can take advantage of flexible premium payments, as your income changes.
- Protect Your Assets: If you’re in retirement or almost there, you have the ability to set aside money without paying taxes until you make a withdrawal4. You also may have the chance to grow your cash value faster than with another financial product, and ensure your beneficiaries receive the death benefit5 without probate delays.
With My Choice IULTM, you also have the ability to grow your cash value in two ways:
- Indexed Account: The indexed account is usually linked to the performance of an index over a specific time period, up to a maximum cap rate. This gives you the ability to take advantage of an up market but also provides the protection of a 0% guaranteed floor. This means your certificate will not lose value due to a down market.
- Fixed Account: For those who prefer a more conservative approach, the fixed account is a good choice. Your account will earn interest at a competitive interest rate and provide an opportunity for steady, stable growth.
Visit WoodmenLife.org/MyChoice to find out more about My Choice IUL.
- A maximum single premium is allowed at the time of application. Additional premiums may be necessary in the future to keep the certificate in force.
- Loans and withdrawals will reduce the policy’s death benefit and available cash value. Excessive loans or withdrawals may cause the policy to lapse. A loan, withdrawal or surrender may be a taxable event. For tax advice, consult with your professional tax advisor.
- IUL is not an investment. It is a life insurance policy that provides growth potential through index interest crediting. You cannot invest directly in an index.
- There may be tax implications for policies recognized as modified endowment contracts (MECs). Distributions, including loans, from a MEC are taxable to the extent of a gain in the policy, and may also be subject to a 10% additional tax if the owner is under 591/2.
- Death benefit proceeds from a life insurance policy are generally not included in the gross income of the taxpayer/beneficiary (Internal Revenue Code Section 101(a)(1)). There are certain exceptions to this general rule including policies that were transferred for valuable consideration (IRC §101(a)(2)). This information should not be construed as tax or legal advice. Consult with your tax or legal professional for details and guidelines specific to your situation.
Flexible Premiums Adjustable Indexed Life Certificates ICC18 8730 4-18, 8730 4-18 (XX).
Universal Life insurance products contain fees, such as mortality and expense charges (which may increase over time), and may contain restrictions, such as surrender periods. This certificate could lose money. WoodmenLife will provide notification if the guaranteed monthly deductions and interests are expected to exhaust the plan’s cash values prior to the maturity date. This certificate is not guaranteed to stay in force until maturity based on minimum guarantees.
Products are not available in New York and may not be available in all states.