How IUL works
First, you pay a premium.
You pay in monthly or yearly, and within limits, you choose how much.
Then your cash value is credited.
You don't own stocks. The insurer tracks an index, such as the S&P 500.
Later, you can use it.
Over many years, the cash value can build up inside the policy.
The insurer takes out the cost of cover and its fees. The rest goes into your cash value.
If the index rises, you're credited interest up to a cap. If it falls, a floor stops the loss. Fees come out either way.
Three things your policy does from then on:
- Death benefit
- Paid to the people you name when you die.
- Cash value
- Yours to borrow against or withdraw while you're alive.
- Loans and withdrawals
- Reduce what your family receives, and can make the policy lapse if it runs low.
What smart owners know
Each benefit works best when you know how to use it. Flip the switch to see how.
It can cover you for your whole life.
Keep it funded and the cover stays in place for life.
Your cash value can grow with an index.
A floor protects it in down years. In up years, growth is capped, and fees come out yearly.
You can borrow against it.
Borrow with a plan. Loans charge interest and reduce what your family receives.
You can change what you pay.
Paying more in good years builds more cash value. It's built to hold long term; cancelling early carries surrender charges.
It may offer tax advantages.
Set it up right to make the most of them. A licensed professional can show you how.
Who IUL is built for
Built for you if
- You want cover that lasts your whole lifeTerm ends. IUL is built to last.
- You already max out your 401(k) and IRACash value is one more place to set money aside.
- You plan in decades, not yearsCash value builds over time.
- You want to leave something behindThe death benefit goes to the people you name.
- You like to stay on top of your moneyA yearly review keeps it on track.
Start somewhere else if
- You want the most cover for the least moneyTerm life gives the most cover per dollar.
- You'll need the money in the next few yearsIUL is built for the long haul.
- You're still building an emergency fundPut the basics in place first.
- You want full stock market exposureIUL trades some upside for a floor.
Built for those who plan in decades.
The longer it's in place, the more time your cash value has to build.
What careful buyers ask
Is IUL an investment?
It's life insurance with cash value, not a market investment. That's the point: a floor protects it in down years, and it sits alongside a 401(k) or IRA rather than replacing them.
How is IUL different from whole life?
Whole life has fixed premiums and a growth rate the insurer sets. IUL lets you adjust what you pay and links growth to an index, with a cap and a floor. More flexible, more to watch. See them side by side.
How does IUL protect my cash value?
The floor means index losses are never credited to your cash value. Fees and the cost of cover still come out yearly, so keeping it funded and holding it long term is what keeps it strong.
How is IUL taxed?
Life insurance may offer tax advantages, but the rules are detailed and depend on how the policy is set up and used. Talk to a licensed professional about your own situation.
How much does IUL cost?
It depends on your age, health, death benefit and how much you pay in. IUL costs more than term because it lasts for life and builds cash value. An agent can quote you.
What happens when I ask for a call?
A licensed agent in your state calls at the time you chose and explains IUL next to term and whole life. No obligation to buy.
Get your own IUL walkthrough
One free call with a licensed agent, at a time you choose. No obligation.
- A licensed agent in your state calls when you said.
- They ask about your goals and explain IUL, term and whole life.
- You decide. Nothing is sold on the first call unless you ask.
Thanks, .
A licensed agent will call you . Their number may be from your state, so it may not be one you know.
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