Introducing L.I.F.E. Premium Finance
Learn more about this brand-new strategy for a tax-free retirement income and death benefit.
Premium financing is one of the best ways to save for retirement, secure your legacy, and decrease your tax burdens, but the net worth and collateral requirements have kept many people from experiencing these benefits. At some companies, the minimum net worth for premium financing is as high as $15M in assets and investments.
But what if there was a way to access the benefits of premium financing with a lower barrier to entry?
Now, there is, thanks to our newest offering in partnership with OPTIMUS Life Designs®. We introduce L.I.F.E. - Life Insurance Financed Equity.
What Is Life Insurance Financed Equity?
Life Insurance Financed Equity, or L.I.F.E., is the best partial financed strategy in the industry today, and it’s now available to high-income individuals with a net worth of $2.5M or more in assets or investment.
This strategy allows people to purchase larger life insurance policies with partial financing. The individual funds a portion of the plan up front, and then secures bank financing to cover future premium payments.
In this way, qualifying individuals can super-charge their tax-free retirement strategy while (in most cases) using their policy as collateral.
What are the Benefits of Financed Life Insurance?
L.I.F.E. provides many of the same benefits as traditional premium financing, but with less stringent requirements, it’s accessible to more people.
In particular, L.I.F.E. provides the highest projected stream of retirement distributions, thanks to the additional leverage the bank provides. In addition, L.I.F.E. establishes a permanent death benefit that will be paid out to your heirs’ tax free.
If, for a hypothetical example, you invested $100,000 into a 5.74% taxable account for 7 years, your projected returns after tax would be $1.57M. If you invested that same 100,000 into a 5.74% gross indexed life plan, your projected returns would be $6M in tax-free earnings, in addition to the 1.6M age 100 death benefit.
That’s nearly 5X greater performance between the tax-free returns and the death benefit! Imagine how much of an impact that difference could make in your retirement, and in the legacy you leave behind for the people you love.
If structured properly, the death benefit will be paid out tax-free, and can even be used to pay any additional estate taxes. This is especially important if you anticipate that your estate could be worth more than $12 million upon your death.
On top of this, the L.I.F.E. Plan also:
- Allows 1035 exchanges
- Can be structured as a business-sponsored policy for owners and key executives
- Has a broad range of plan designs, including 5, 7, and 10 pay for retirement distributions
- Includes 10 pay and 15 pay death benefit options
- Includes a comparison versus a hypothetical Taxable Account as a reference point
- Works with PDX 2, PIA 6, Horizon, and Survivor
And because the policy’s cash value is typically used as collateral for the loan, you’re able to keep more of your wealth invested in other high-returning assets, rather than liquidating investments to provide collateral.
Trust the Experts in Premium Financing
At Goheen Companies, we’ve seen countless advisors and their clients reap the rewards of premium financing. Our team has more than 100 years of combined experience and more than $1B in managed premiums.
Our vast network of lenders and insurance carriers allows us to negotiate on our clients’ behalf, ensuring they receive the best possible rates and designing a plan that’s adjusted for risk and includes a clear exit strategy.
With this new L.I.F.E. product, we’re excited to start bringing the benefits of premium financing to a broader audience.
In particular, the L.I.F.E. Plan can benefit:
- Business owners interested in securing their legacies
- Businesses looking to purchase key person insurance
- High wage earners (with a net worth of $2.5M or more) looking for a tax efficient retirement plan
- High net worth individuals focused on estate planning
To learn more about L.I.F.E. and find out if this strategy is the right fit for your needs, contact us today.