Life Insurance
Why do I need life insurance?
Life insurance is an essential part of many financial programs. Most people buy life insurance to replace income that would be lost at the death of a wage earner. The cash provided by life insurance can also help ensure your dependents are not burdened with significant debt when you die. Keep in mind that in order to purchase insurance, you will have to qualify for coverage.
Some of the benefits of life insurance include:
- Providing loved ones with an income tax free death benefit: Life insurance is a financial instrument that provides instant dollars at your death – and you choose where those dollars go. Free of income taxes, you can fund a favorite charity or provide a legacy for loved ones. Keep in mind that the death benefit is subject to the claims-paying ability of the insurer.
- Protecting yourself from living “too long”: Life insurance is designed to cover one of life’s greatest hazards: premature death. Because of its accumulation potential and access to the cash value, life insurance can help address the opposite problem: living too long and running out of money. For example, life insurance permits you to access a portion of your cash value – through a loan – on a tax favored basis. If you decide to take a loan, and the policy contract is surrendered with an outstanding loan, it could create a taxable event. A loan will also reduce the cash value and death benefit.
- Building an instant estate: Life insurance is the only financial vehicle that creates an instant estate at your death.
- Providing cash value: Some life insurance policies have a cash value feature which lets you contribute premium in addition to the amount you pay for your insurance coverage. Learn more about Cash Value Life Insurance.
If you decide to purchase a policy, part of the amount you pay in premium is used to cover certain fees and expenses such as mortality, distribution fees – as well as other fees and expenses that apply based on the policy you choose.
» Get more information on life insurance.
» Learn more about key life insurance terminology.
This information should not be considered as tax advice. You should consult your tax advisor regarding your own tax situation.
Long Term Health Care Planning
The thought of growing old has it benefits: retirement, grandchildren, traveling and free time. Growing older also brings the unhappy thoughts of planning for when you will be unable to provide all the necessary care you need. Forward thinking is especially true for most women. Statistically women are living seven years longer than men1 – often requiring long term health care. The thought of entering a nursing home or needing in-home care is often “something that happens to other people.” But sometimes we are those other people. Without adequate long term health care planning, the costs associated with care can potentially drain your personal savings and retirement assets. Maintaining your independence is a priority and a goal that can be accomplished by planning now for any future long term health care needs.
» Get more information on long term health care.
Annuities
Saving for retirement is crucial, and making sure those resources last throughout your lifetime is just as important. Annuities can do both – helping you save, then offering you a steady stream of income you cannot outlive. To improve financial security in retirement, more and more people are including annuities in their financial strategies.
What is an Annuity?
An annuity is a contract between you and an insurance company that allows you to deposit a certain amount of money from which an insurer makes payments to you over a period of time spelled out in the contract. An annuity may also provide income to another person, such as a surviving spouse.2 Note – the guarantees available in an annuity are dependent upon the claims-paying ability of the insurer.
Annuity Benefits:
- Tax Deferral: Taxes on annuity earnings are deferred until you start receiving payouts.
- Beneficiary Protection: If you die before you begin receiving payouts, annuities generally have an insurance feature that guarantees your heirs will receive a death benefit.
- Withdrawal Flexibility: You have flexibility in how you receive annuity payouts, including a lump sum, systematic withdrawal options, or an arrangement where you collect a steady stream of income for as long as you live.
- No Limit on Contributions: There are no tax restrictions on the amount you can contribute to your annuity, (contract limits do apply in some cases).
- Timing Flexibility: There are no required minimum distributions at age 70½, which means you don't have to begin receiving payout at this age.
An annuity is a long-term, tax deferred investment vehicle designed for retirement. Earnings are taxable as ordinary income when distributed, and if withdrawn before age 59½, may be subject to a 10% federal tax penalty. If the annuity will fund an IRA or other tax qualified plan, the tax-deferral feature offers no additional value. Not FDIC/NCUA insured. Not bank guaranteed. Not insured by any Federal Government Agency. There are charges and expenses associated with annuities, such as deferred sales charges for early withdrawals.
» Get more information on annuities.
Trust Services
Years ago, you carefully planted the seeds of wealth. Nurturing the growth of your assets along the way, your estate matured into a legacy that you would like to preserve for your children or grandchildren. For more information on ways you can preserve your legacy, visit Securian Trust Services.
Building Blocks – Investment Fundamentals
Whether it’s planning for retirement, funding a college education, protecting your estate, or managing your business needs, your investments will play a major role in reaching your goals. A variety of investments and resources can be utilized to create a comprehensive financial strategy for your specific needs. Consult with your financial advisor on the approach that will work best for you, or for more information, visit Securian Financial Services.*
Women and Business Solutions
Endless time and energy is spent building your business. Financial security, retaining key employees, loyal clients and expanding industry knowledge are only a few goals you will need to consider. We can help you build your business and your financial security. Read more about solutions for your business.
* Securities and Investment Advisory Services offered through Securian Financial Services, Inc., Member FINRA/SIPC.
1 U.S. Census Bureau January 26, 2005 (updated employment and income numbers)
2 Insurance Marketplace Standards Association – Consumer guide to Annuities