Life Insurance Policy can Offer Same Benefits as IRA

Most people think about retirement when it comes time to retire. But important milestones are worth planning ahead for. Similar to retirement, it’s crucial to prepare and financially protect your loved ones from the unexpected.

When it comes to leaving money to beneficiaries, the hassle-free nature of life insurance may be a better way to transfer your estate to beneficiaries.

Individual retirement accounts (IRAs) are a common investment tool used by Americans to create financial security. When creating a will or trust, many people miss important steps that are necessary to ensure their heirs get the most from funds.

For an inheritance from an IRA not to get eaten up by taxes, it’s best to get it “stretched,” reports the Apex Herald. Setting up a stretch takes several steps, so it’s best to consult a qualified estate planner.

With a stretched IRA, “a non-spouse beneficiary cannot roll the assets into his or her own account,” according to the Apex Herald.

Life insurance policies, however, can offer the same tax benefits and growth opportunities without the hassle. A variable universal life insurance policy is similar to an IRA in that the funds are dependent on how well investments perform. Investing in a life insurance policy offers a variety of options, including stocks, bonds and balanced mutual funds.

The Family Care Foundation, a grassroots organization concerned with community development, offers estate planning advice and resources. Many question that they do not have an estate since there are those that really feel that word indicates another form of being wealthy. Their philosophy is if you have possessions, you have an estate.

They offer detailed guidance concerning the tools of estate planning require a will, trust, life insurance policies, by and sell agreements as well as deferred employee benefits.

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