Term Life

Term life insurance provides death protection for a stated time period, or term. Term life insurance is perhaps the simplest form of life insurance. It was developed to provide temporary life insurance protection on a limited budget. Since term insurance can be purchased in large amounts for a relatively small initial premium, it is well suited for short-range goals such as life insurance coverage to pay off a loan, or providing extra life insurance protection during the child-raising years.

In most states, carriers offer term insurance policies providing level premiums for 5, 10, 20, 25, and 30 year periods. These policies can be renewed or continued at higher premiums in most states.

Term Conversion

The conversion rights on many term policies guarantee that for a specified period of time and/or up to a certain age, the policy can be converted to a permanent plan for the equivalent amount of coverage without having to provide additional evidence of insurability.

Permanent life insurance coverage can be important to your overall financial plan. When you convert the term insurance coverage, you can take advantage of several benefits:

• Lock in permanent rates now while you are young and premiums are affordable
• Permanent products offer a guaranteed death benefit and level premiums for the life of the policy.
• Term conversions do not require medical or financial re-qualification.
• The opportunity to build cash value, for loans or withdrawals on the policy to help supplement retirement or other future cash needs.

Universal Life & Whole Life

Permanent insurance, including Whole Life Insurance and Universal Life Insurance, can provide protection for your entire lifetime, or in certain instances up to a specific age — at which point they pay the policy owner the cash value. Permanent life insurance policies can build a cash value — money that you can borrow against and in some instances, withdraw to help meet future goals, such as paying for a child's college education.

Features of Universal Life

• Flexibility — You decide how much life insurance you need -- and subject to certain requirements and limitations, you can adjust the death benefit and premium payments to fit your changing needs.
• Security — It helps protect your loved ones against possible financial hardship in the event of the insured's death.
• Tax-Free death benefit — Under current tax laws governing individual life insurance, life insurance proceeds are generally income tax free to the beneficiary.
• Tax-Deferred account value growth — The policy's account value earns interest at the carrier's current interest rate — federal income tax deferred.

What is Annuity?

An annuity is a stream of income. It may last for your lifetime, like a pension, or for some other specified period. Payments can start now (an immediate annuity), or at some time in the future (a deferred annuity). An annuity can help you save for retirement, tax-deferred, and allows you to enjoy a steady stream of income for the rest of your life. An annuity can also help maximize your income throughout retirement; a way to cover your basic expenses, allowing you to more efficiently invest your remaining assets to grow your overall portfolio.

Fixed Annuities

A fixed annuity earns a fixed interest rate on your premium. This amount is declared by the insurance company and can change over time and includes a guaranteed minimum interest rate that the contract will earn.

Additional benefits offered by fixed annuities include:

• Tax-deferred growth potential
• Guarantees to your principal
• The option to take a lifetime income stream
• Avoiding probate with a properly named beneficiary other than your estate

Lifetime Income

Annuities can help keep up with the effects of inflation by offering market growth potential. You need to participate in the market if you want to grow your assets. Market participation is one way to help offset inflation and accumulate the money needed for a longer life.

Death benefit protection

Know that your beneficiaries are protected. An annuity assures that if you die before you start taking income, your beneficiaries will receive at least the amount of your initial investment.

Assets Growth potential

Annuities let you choose different investment options. Diversify your allocation by choosing a portfolio among stock, bond, and money market options. Annuities may also offer enhanced income benefits that provide guaranteed annual increases and gains that may lock in.

Tax deferral

With an annuity, you don’t pay taxes while your earnings accumulate, and when you begin withdrawing money from your contract, you only pay ordinary income taxes on your earnings – not on your purchase payments. Tax-deferred growth, compounded over time, may increase the amount of income your annuity generates for your retirement.

Purchasing an annuity within a retirement plan that provides tax deferral under sections of the Internal Revenue Code results in no additional tax benefit. An annuity should be used to fund a qualified plan based upon the annuity’s features other than tax deferral. Other benefits of using an annuity to fund a qualified plan or an IRA include lifetime income options and guaranteed death benefit payout options. All annuity features, risks, limitations, and costs should be considered prior to purchasing an annuity within a tax-qualified retirement plan.