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The Pension Maximization strategy utilizes life insurance to resolve some of the possible conflicts that arise from a defined benefit pension plan distribution. If you are married and have a company pension or defined benefit plan, upon retirement you are often faced with making a difficult decision regarding your desired payout—either a Single Life option or a Joint and Survivorship option.
• The Life Only benefit is generally larger, often times one-third or more than the Joint and Survivor benefit. • The choice is between a larger lifetime benefit with no survivor benefit versus a reduced lifetime benefit but a continuing income for the surviving spouse. • The Joint and Survivor option is only useful if the spouse outlives the retiree. • Regardless of which option is chosen, the payments end after the death of the retiree or the death of their spouse. There is nothing left for heirs. This is where the Pension Maximization Strategy comes in and may increase the retirement income available to a client and their spouse from a defined benefit pension plan. The retiree elects to take the larger Life Only benefit and purchases life insurance to replace the survivor benefits that they have forgone. But what if you the retiree outlive your spouse? What if you both live a long life and die at about the same time? These are possible scenarios where the Single Life option would seem to be the better decision. It’s impossible to predict what is going to happen, so it seems impossible to make the right choice. Contact us today to see if this retirement planning strategy is suitable for you. 401(k) RolloversMaking a job transition can be emotional and not a time to make hasty decisions about your money. Beware of cashing out, which often comes with high taxes and penalties which may undermine your ability to reach your long-term goals.
Rolling your 401(k) into an IRA gives you the possibility to: • Get more flexibility with your investments. • See your entire retirement picture in a single view. • Keep your retirement savings tax-advantaged • Grow your retirement savings into lifetime income Before making any decision, here are some factors to consider: • Investment options • Fees and expenses • Withdrawal requirements and potential penalties • Tax consequences • Account services • Protection from creditors There’s a lot of things to think about when you leave an employer, including how best to reach your financial goals. Together we can determine if a 401(k) rollover is right for you. Schedule your consultation today. AnnuitiesAnnuities are contractually-executed, relatively low-risk investment products; the insured (usually, an individual) pays a life insurance company a lump-sum premium at the start of the contract. That money is to be paid back to the insured in fixed, incremental amounts, over some future time period (predetermined by the insured). The insurer invests the premium; the resulting profit/return on investment fund the payments received by the insured, and, compensate the insurer.
Conventional annuity contracts provide a predictable, guaranteed stream of future income (e.g., for retirement) until the death(s) of the beneficiaries(s) named in the contract, or, until a future termination date – whichever occurs first. These financial instruments have been used to accumulate funds and provide significant and sudden increases in personal income (via future, lump-sum withdrawals), all while legally avoiding the taxes (e.g., income-, capital gains-, estate-) that would otherwise be assessed on them. Immediate Annuities vs. Deferred Annuities An Immediate Annuity is an insurance policy which, in exchange for a sum of money, guarantees that the issuer will make a series of payments. These payments may be either level or increasing periodic payments for a fixed term of years or until the ending of a life or two lives, or even whichever is longer. A Deferred Annuity is a contract that is chiefly a vehicle for accumulating savings with a view to eventually distribute them either in the manner of an immediate annuity or as a lump-sum payment Contact us to learn more about the right annuity for you. Long Term CareLong-term care insurance (LTC or LTCI), an insurance product that helps provide for the cost of long term care beyond a predetermined period. Long-term care insurance covers care generally not covered by health insurance, Medicare, or Medicaid.
Individuals who require long-term care are generally not sick in the traditional sense, but instead, are unable to perform the basic activities of daily living (ADLs) such as dressing, bathing, eating, toileting, continence, transferring (getting in and out of a bed or chair), and walking. The Benefits of Long Term Care Insurance Long-term care insurance generally covers home care, assisted living, adult daycare, respite care, hospice care, nursing home and Alzheimer's facilities. If home care coverage is purchased, long-term care insurance can pay for home care, often from the first day it is needed. It will pay for a visiting or live-in caregiver, companion, housekeeper, therapist or private duty nurse up to seven days a week, 24 hours a day (up to the policy benefit maximum). Other benefits of long-term care insurance:
Medicaid provides some of the benefits of long-term care insurance. A welfare program, Medicaid does provide medically necessary services for people with limited resources who need nursing home care but can stay at home with special community care services. However, Medicaid generally does not cover long-term care provided in a home setting or for assisted living. People who need long-term care often prefer care in the home or in a private room in an assisted living facility. Contact us to learn more about the right long term care insurance for you. |
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