Life Insurance Retirement Plan (LIRP)

Description
As a life insurance policy designed to take advantage of tax treatment of life insurance, it is suited for investors with high income, which may exclude them from participating in Roth IRAs. A LIRP can provide a long-term accumulation vehicle for supplemental retirement income. In addition, at your death, it offers a benefit to help replace lost income for those who depend on you.

Objective
To provide investors supplemental retirement income via a life insurance policy featuring market appreciation, tax-deferred accumulation, and a life insurance death benefit.

Suitability
Variable Universal Life insurance is often used as a vehicle for a Life Insurance Retirement Plan. Over-funding a policy is best suited for investors already taking full advantage of other tax-advantaged ways to save for retirement. A LIRP is an option for those investors wanting to invest more for retirement once they have reached the contribution limits on qualified plans.

Product Features 

  • Earnings grow tax-deferred – payouts can be structured to provide an income
  • Owner can structure tax-free payout from policy withdrawals and loans
  • Death benefits paid to the beneficiaries are income tax-free
  • Contributions should be made for at least 10 years
  • Policy cannot lapse or all loans become immediately taxable
  • Usually have a surrender charge in the first 10-15 years
  • Must be insurable
  • Death benefit included in the owner's estate, if the owner is also the insured and dies
Edward Jones operates as an insurance producer in California, New Mexico and Massachusetts through the following subsidiaries, respectively: Edward Jones Insurance Agency of California, L.L.C., Edward Jones Insurance Agency of New Mexico, L.L.C. and Edward Jones Insurance Agency of Massachusetts, L.L.C.
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