Consider utilizing a product that would offer the following:
Accumulating cash reserves similar to a Roth IRA; the contribution is not tax-deductible, but grows tax deferred and returned, if designed effectively, as tax-free income.
Offering the availability to access cash for long-term care needs with a similar definition to traditional LTC insurance.
Providing a supplemental income for some period of years or life at retirement.
And, oh by the way, offering a sizeable tax-free benefit to your family along the way... just in case you don't make it.
Can this really be arranged? Yes, it can, but most folks would sneer at me and say that the product is non-competitive in the financial market place. I beg to differ with that assessment. Not only is it competitive, but it is a safe money product. Let me illustrate just briefly.
A male age 40, in good health, could stash an IRA level premium ($5,000 per year) between now and retirement at age 67, and he may give himself a tax-free supplemental retirement income of over $20,000 per year for 20 years; have access to cash for long-term care dollars; and, give his family a sizeable benefit should he die along the way to retirement.
Key issues in any financial planning are flexibility and solving multiple problem areas efficiently. These attributes are fundamental elements of this planning tool.
Are you able to offer a single alternative that will do all of these things? Would you be surprised if I told you this solution is made possible with a plan of permanent life insurance? OK, are you ready to sneer at me and tell me about the non-competitiveness of life insurance?
Unfortunately, permanent life insurance is often overlooked as a part of the solution for a financial plan including retirement. What I often hear is that "I will buy term insurance and invest the difference". Could be a solid idea, but two things get in the way. Term insurance has an ever-increasing cost; annual premiums that will escalate beyond what may be tenable and an overall cost that will eventually eclipse the benefit. And, the "invest the rest" often never happens or may not reach the desired accumulation goals. What one ends up with is a thank you from the insurance company for all those premiums paid and a small to non-existent nest egg. Maybe it is time to give stodgy old permanent life insurance another look. It may be a very welcome addition to your overall retirement plan!
Commentary by Paul R. Piche: The best time to consider planning for future retirement and income strategies is when you accept your first full time employment. Retirement and Income planning should not be put off to a later date or considered optional. Answers and strategies relating to this issue may be found in my book "Aloha Shirts, Umbrella Drinks and Island Breezes or PB&J and TV Reruns". Contact me at: http://www.safemoneyassets.com or get your copy of my book at: http://www.outskirtspress.com/alohashirts, or on http://www.amazon.com.