A policy should be selected with your unique risk threshold, much like conventional investments. Life insurance savings plans can be a fabulous way to save for long-term financial objectives.Įach type of life insurance has various risk-reward trade-offs. The goal is to maximize returns by overfunding the policy and eventually borrowing against the accumulating cash value through tax-free loans. With IUL policies, the interest rates are linked to the performance of an underlying financial index such as the S&P 500 Index. Indexed universal life plans put a part of your premium toward annual renewable term life insurance while the balance is added to the policy’s cash value after fees are deducted. IUL insurance is marketed as a cash value policy that benefits from the market’s tax-free gains without the danger of loss during a market downturn.
An IUL insurance is permanent coverage that will last your entire life when properly designed.
