20 Different Ways to Use a Life Insurance Policy, Part 4
Not only can you use the cash value of a life insurance policy to finance your child’s education or for your retirement, but you can also use it to fund your favorite charity. Life insurance is also an important tool for businesses, whether it’s protecting assets or retaining employees. Since there are so many different ways to use a life insurance policy, it is important to determine the reason why you need life insurance and what purpose it will serve for you and your family. Or if your a business owner, what how will life insurance help your company?
Rather than figuring it all out on your own, is important to do your research and speak with a licensed professional who will help you find the right plan for you.
As you determine why you need life insurance, be sure to check out our previous articles, which discuss additional ways to use a life insurance policy. Click here to read more !
16. Fund Your Favorite Charity with a Permanent Policy
Did you know you can make your favorite charity a beneficiary on your life insurance policy? You better believe it! You can significantly boost your donation amount. Plus, the money that is donated upon your death will be tax-free.
17. Turn Life Insurance into “Key Man” Protection
Every company – no matter how big – has key individuals who are integral to the company’s operations and success, and losing such personnel can add financial strain to the company. Therefore, company’s should protect business by buying life insurance policies on key employees.
18. Use Deferred Compensation Plans to Retain Employees
By using Group Cash Value Life Insurance plans, you can offer incentives for employees to remain with your company. There are plans called Nonqualified Deferred Compensation Plans. This type of plan enables employees to build up cash value that’s tax deferred. Also, they can borrow against it, as well as name their beneficiaries, the amount they want to contribute, and the value of the coverage.
19. Create a Cross Buy-Sell Agreement with a Permanent Policy
The purpose of this policy is to protect the owners/partners in a a business, as well as their heirs. First, each owner/partner buys a policy on the other partner(s), which is equal to the value of the share(s) invested in the business. Ultimately, the policy’s structure enables the heirs to sell their share of the business to the surviving partners. Since there are tax issues involved in this type of set-up, be sure to meet with a business financial adviser and/or lawyer.
20. Set Up a Group Life Insurance Plan
Group life insurance can be a perk for your current employees and a huge incentive for potential employees looking to join your organization. It’s especially a perk for the employees whose health prevents them from finding affordable life insurance. A Group Plan is generally inexpensive. Plus, employees can purchase additional life insurance coverage to supplement their Group Plan.
Stay tuned to find out more ways to use a life insurance policy! Also, get with one of our life and financial experts today! They can help you choose a policy, or they can conduct a policy review to ensure that your current policy is still right for you!
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