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Monthly Archives: March 2018

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Help Keep Your Life’s Goals on Track

Help protect your financial future with a periodic life insurance review

You’re already on your way to a more protective financial future with the life insurance you have, but how often do you review your policy? Do you still have the same needs as when you first bought coverage? Can your needs be met more economically? With the passage of time, life changes, and scheduling a client review with your agent can help keep you on track.

 

CAN YOU BENEFIT FROM A CLIENT REVIEW?

You may periodically review your bank statements, retirement portfolio, and car insurance, but have you recently looked at your life insurance policy? Life insurance is a part of your financial strategy, and a regular review can help make sure your goals and protection needs are being met. Consider these statistics:

 

 

In addition to making sure your coverage needs are met, you may be able to improve your situation in several ways:
  • You may be able to lower your premium cost for the same amount of coverage.
  • You may be able to gain more coverage for the same premium you are paying now.
  • It may be possible to improve the death benefit guarantee.
  • There may be a way to help improve policy performance and build cash value.
  • You may be able to gain features and benefits not available on your current policy.
If you haven’t reviewed your life insurance policy in a while or other policies that may be in your household, a phone call to your life insurance agent is all it takes. Your life insurance agent is trained to review certain items to make sure you’re on track with your life insurance goals.
All financial tools need a periodic review, including life insurance. Life insurance policy offerings have changed significantly over the years, and making the right adjustments now may better prepare you for the future.

 

WHY REVIEW YOUR INSURANCE?

Life is unpredictable, and the passage of time may bring about a new home, a job change, children, and even a change in health. These are all life events that may affect your life insurance coverage. A client review gives you the opportunity to review your current financial situation and evaluate your life insurance needs.
Here are a few life events that may prompt a further look at your life insurance coverage:
  • Change in marital status
  • New home
  • Job promotion/job change
  • Taking on debt
  • Planning for college
  • Planning for retirement
  • A significant change in assets
  • Changes in your business if you’re a business owner
This list of life events is a guideline to help evaluate your current situation. There are many other events to consider, like whether or not your children are out of college and on their own. In this case, the original reason for purchasing coverage has probably changed, and there may now be a need for retirement or estate planning.
In addition to life events, there may be other circumstances that may affect your policy:
  • Your health: Have you lost weight or stopped smoking? Your health is a consideration when reviewing your life insurance policy.
  • The economic environment: Interest rates fluctuate and could be quite different from where they were a few years ago. These interest rate changes may play a role in the performance of your policy.

 

HOW DOES IT WORK?

Your agent will take a comprehensive look at your policy and analyze its features and performance to see if your original objectives are being met. If adjustments need to be made, your agent will present you with options. If the policy is currently on track with your original goals, then no changes will be needed. The important step is to take action and to see if you’re still on track with your financial protection needs.
There are a few items to note when reviewing your life insurance policy. The list below is not meant to be comprehensive, but it may help you get started in the right direction.
  • Examine your annual premiums: How much are you paying? Is the amount still within your budget?
  • Look at your beneficiary designations: Make sure your beneficiary designations are up-to-date.
  • Review the death benefit amount: Does the death benefit provide you with enough coverage? Items that may affect your death benefit are cost-of-living expenses and any life events.
  • Consider your supplementary benefits: Are there riders or endorsements you no longer need? Are there new riders that may be beneficial to your situation?
Life insurance is a key component to your overall financial plan. Take a moment and help ensure your life insurance goals are being met.

 

 

Give your agent a call today to help make sure you’re on track with your life insurance goals.

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Gain Death Benefit Protection & Help with Tuition Costs

Achieve financial protection and help pay for the increasing costs of college tuition.
The primary purpose of life insurance is to provide a death benefit to beneficiaries. This benefit protection can make life insurance an attractive choice for creating a self-completing plan to help fund a college education.
While many people are aware that the cost of a college education has been on the rise, many underestimate just how large this cost has grown. According to the 2015 Trends in College Pricing published by The College Board, over the past decade, the published in-state tuition and fees for four-year public colleges and universities grew at an average rate of 2.9% per year beyond the rate of inflation. At the same time, many families lack life insurance protection, which many consider to be the cornerstone of financial protection. Recent studies show that four in ten U.S. households have no life insurance coverage at all, which leaves them vulnerable should the primary breadwinner die unexpectedly. What many people may not realize is that with the right life insurance policy, you can secure needed death benefit protection while gaining a way to help pay for college education.

 

Why life insurance?

Your personal savings should be the primary source for college funding. However, that comes with a challenge: if the family’s primary breadwinner dies prematurely, the personal savings plan typically comes to an abrupt end. In this situation, a life insurance policy can help. The policy’s death benefit could be used to help pay college tuition costs.
Another key benefit of permanent life insurance, is that it has the potential to accumulate cash value on a tax-deferred basis.1 Those funds can then be accessed while the insured is living to help pay for college costs.
Some of the advantages of a permanent life insurance policy include:
  • Parental stewardship. The policyowner has control of the policy’s potential accumulated cash value. Should plans change, the accumulated cash value can be used for other purposes without tax consequences.
  • Tax-deferred growth. Cash values within a life insurance policy generally grow tax-deferred.
  • Policy loan options. Different loan options are available to help you access the potential cash values within your policy.

Who can benefit?

There are a few items to consider before using life insurance for death benefit protection and a way to help pay for tuition costs:
  • Are you in need of life insurance protection to help ensure your family is financially protected?
  • Do you have a child or children up to 13 years old?
  • Are you concerned about college tuition costs?
  • Are you possibly looking to help supplement income in your retirement years?
It’s important to explore your options and to work with your life insurance representative to gain a clear picture of your needs. There are costs with life insurance. Permanent life insurance policies require monthly deductions to pay the policy’s charges and expenses, some of which will increase as you get older. These deductions may reduce the cash value of the policy.

How does it work?

After a thorough needs-based discussion with your life insurance representative, you select a life insurance policy that matches your needs. The basic steps typically include:
  • Purchase of a permanent life insurance policy. The policy provides death benefit protection and a way to help accumulate cash value on a taxdeferred basis.
  • If the unexpected happens and you die prematurely, the life insurance death benefit would be paid generally income tax-free to beneficiaries.
  • Alternatively, when it comes time for you to pay tuition costs, you may access the policy’s potential cash values through generally tax-free loans or withdrawals.
  • After helping to pay tuition costs, you may reposition the policy for other possible needs, like helping to supplement your retirement income.

 

 

Get started today. Contact your LHENetwork representative and financially protect what’s important now, while helping to fund a college education.

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Financially protect your family & help supplement income for your retirement

 

If you’re concerned about the financial security death benefit protection can provide for your family today should something happen to you, and you’re also uneasy about the future and falling short of retirement income, it may be time to consider life insurance. With life insurance you gain death benefit protection that can help your family pay the mortgage, utility bills, and other expenses should you die. Now, imagine your retirement. What retirement lifestyle do you imagine? It’s easy to underestimate the cost of your ideal retirement. Permanent life insurance can help bridge any gap between what you have already saved and what you will need in the future. If you’re looking to control your financial future, consider a permanent life insurance policy with the potential to build cash value that can be used to help supplement your retirement income.

WHY LIFE INSURANCE?

Life insurance can help you with two unknowns—the loss of income from a premature death and having sufficient income to enjoy your retirement. With life insurance:
  • You gain death benefit protection not only during your important working years, but also in retirement. In the event of death, the proceeds are distributed to your beneficiary(ies), generally income tax-free.
  • Your premium payments into a permanent life insurance policy pay for the insurance coverage and expenses and a portion may accumulate cash value on a tax-deferred basis.2 Through policy loans and withdrawals,3,4 the cash value may then be used during retirement as a source to help supplement income.
Cash value on our policy can be used how you see fit.

WHO CAN BENEFIT?

There are a few items to consider when deciding whether to use life insurance as part of your retirement planning. First, consider your need for life insurance today—think about the items your family will need to pay on their own without your income, should you die prematurely. Next, take a close look at your retirement plan. Will you have sufficient assets to live your planned retirement lifestyle? Is there a potential need to help supplement your retirement income. If these items concern you, you’re not alone.

Two-thirds of Americans worry about having money for retirement. When asked why, 50% are concerned about the economy and 45% said they haven’t saved enough for retirement.
* Life Insurance Market Research Association (LIMRA) “LIMRA’s Facts About Life” 2015.

Here are a few questions to consider to help you determine if using life insurance for financial protection and a strategy to help supplement your retirement income is right for you.
  • Do you have a need for life insurance protection today to help replace your income in the event of your death, to help your family pay for items such as the mortgage or rent, insurance premiums, automotive expenses, property taxes, and groceries?
  • Are you planning for retirement and are between the ages of 30 and 60?
  • Are you interested in having additional retirement income stability?
  • Have you utilized a qualified plan (such as an IRA, tax-qualified annuity, 401(k), or savings plan offered through your employer) or don’t have access to a qualified plan for retirement planning?
This list is not complete and there are other items to consider. Your life insurance representative can take a closer look and help you evaluate your needs.

LIFE INSURANCE ADVANTAGES

  • Immediate financial protection and control. Gain death benefit protection for your loved one. You own and control the life insurance policy.
  • Tax-deferred growth. Your premium payments may earn interest and grow on a tax-deferred basis.
  • Flexible premium. With a universal life or an indexed universal life (IUL) insurance policy, you can adjust your premium payment based on available resources. However, there are limits on the amount of premium that may be paid into a policy to qualify as life insurance.
  • Generally tax-free distributions. Any potential cash values within your policy can be taken as generally income tax-free loans and withdrawals, as long as the policy is not a Modified Endowment Contract (MEC). Withdrawals are income tax-free up to the cost basis. (Cost basis is the amount equal to the total premiums paid.)

LIFE INSURANCE DISADVANTAGES

  • Reduced death benefit. Additional premiums may be necessary to continue the desired death benefit, depending on funding. Policy loans and withdrawals will reduce the death benefit and may cause the policy to lapse. Withdrawals may be subject to surrender charges that may reduce the death benefit and cash value.
  • Non-guaranteed performance. Cash values for loans and withdrawals in later years may be more or less than originally planned. Minimum premium payment requirements must be met to maintain the policy, provide for cash value growth, and avoid lapse if the policy becomes over-loaned. Depending on funding, life insurance may not guarantee avoiding loss of premium.
  • Premium payments are not tax-deductible. Your premium payments for life insurance are not tax-deductible.
  • Avoid creating a Modified Endowment Contract (MEC). Life insurance policies that surpass certain premium limits can be classified as a MEC. MECs may be subject to unfavorable tax treatment. Talk with your life insurance representative for more details and learn how to structure your policy appropriately.
  • Cost of insurance. Permanent life insurance policies require monthly deductions, which include cost of insurance, expense charges, and potentially other charges. These deductions may reduce the cash value of the policy.
  • Surrender charges. Withdrawals may be subject to surrender charges and the amount available for policy loans.

HOW DOES IT WORK?

After a thorough needs-based discussion with your life insurance representative, you select a life insurance policy that matches those needs. Your representative will help structure the policy to match the desired death benefit coverage, and provide you the ability to access any potential cash values to help supplement your retirement income.

 

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Longevity Planning

 

Protect yourself and those you love by being prepared for an extended retirement.

Thanks to medical advancements and a nationwide emphasis on healthy living, life expectancy is on the rise in the United States. Today, a 65-year-old man can expect to live until he is 86, and a woman of the same age can expect to live to 89. If the upward trend continues, today’s young adults can look forward to an even longer and healthier life after their working years.
A long and healthy retirement can mean a desire to travel, a new home, new hobbies, gifting assets, and countless other wants or needs that require adequate retirement funds. A long retirement can also be expensive if you experience an unexpected illness.
As life expectancy increases, you might face “longevity risk,” or the potential for your assets to run out during retirement. In addition to providing death benefit protection, permanent life insurance can help you manage that risk.

WHY LIFE INSURANCE?

Permanent life insurance provides death benefit protection that can help you protect your loved ones in the future. Plus, it can be designed with the flexibility to address changing needs throughout your life.
Life insurance can be a twofold strategy as part of your financial plan:
  • Death benefit protection during working years. A solid financial plan often begins with life insurance. In the event of death, the proceeds are distributed to your beneficiaries generally income tax-free.
  • Potential source of funds to help support a longer retirement. Your premium payments on a permanent life insurance policy may accumulate cash value on a tax-deferred basis. Through policy loans and withdrawals, the cash value may then be used to help pay for a wide variety of needs in retirement. These could be planned distributions for planned expenses, or potential cash value may be used as additional funds to help protect you from outliving other retirement income sources or unplanned expenses. You may also access a portion of this death benefit during your lifetime in case of an unexpected illness.
Cash value from your policy may be used for anything, from monthly cell phone bills to out-of-pocket co-pays to a favorite travel destination.

WHO CAN BENEFIT?

Longevity planning has become a key concern for many people. Here are a few reasons why:
  • Loss of a wage earner during working years could disrupt family finances, including retirement plans, house payments, or a child’s tuition.
  • Employers may no longer offer defined benefit plans or retirement health care.
  • As cited previously, life expectancy—and therefore, the length of time people live in retirement— continues to grow.
  • Some form of chronic care is a 70% probability for those over age 65. The average cost of a private room can be over $80,000 a year.
How would your family handle these uncertainties? Are your needs adequately protected? Life insurance could be a viable solution.

HOW DOES IT WORK?

After a thorough needs-based discussion with your life insurance representative to determine if permanent life insurance is right for you, you select a life insurance policy that meets your needs. Your representative will help structure a policy to match the desired death benefit coverage and cash value growth potential.

 

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