You may have heard of a Roth IRA as a good option for retirement planning with favorable tax treatment by allowing after-tax contributions, tax-deferred growth, and tax-free distributions at retirement. The drawback? A Roth IRA is not
available for everyone and has limits to how much you can contribute.
But you may get tax-appropriate features like a Roth IRA (along with additional benefits) from another vehicle: whole life insurance. Take a closer look at where whole life can differ from a Roth IRA.
Whole life doesn't have the income limitations that a Roth IRA has. A married couple filing jointly with income of $203,000 or above can't directly contribute to a Roth IRA.*
Roth IRA contributions may have to market risk depending on the investment options you selected. If the markets are down, your Roth IRA values could go down, too. Whole life has guaranteed cash values not subject to market volatility.
There are restrictions on when and how you can get earnings out of a Roth IRA. With whole life cash value, you can access your policy values when you need them, without penalty.
As of 2019, the Roth IRA annual limits are $6,000 (under age 50) and $7,000 (over age 50). Life insurance policies can be structured to accept much more than $7,000 in annual premiums, which can help if you're trying to catch up and build savings before you retire.
Life insurance provides a tax-free death benefit many times the size of the annual premium. This important feature provides financial assistance during a difficult time for your family and may provide additional funds to assist with the dreams you have for them.
This is just the start! Whether paired with, or as an alternative to, a Roth IRA, whole life insurance can help provide protection, flexibility and potential for your retirement. We're here to help, please call us today for more information, dial 803-359-0872 and ask for Ken or Mike. If you're not able to call right now, you may request more information using the form below.
*Roth IRA contribution and eligibility requirements as of 1/1/2019.