401(k) Investment Alternative
Ginn Insurance works with companies to incorporate this into their retirement plan options. Instead of new mutual fund choices to choose from, employers can offer a totally new investment vehicle with HUGE benefits over the traditional qualified plans like 401k’s or other tax deferred investment vehicles. Now your matching contributions will be done with after tax dollars and your employer will contribute your same 3%, 6% or whatever your 401k match was into a Indexed Universal Life Policy. Allowing this to happen is a win/win situation for the employer and the employee. The employer still gets the deduction (expense), the employee the match with increased safety, flexibility and other features and benefits. The additional options of an Indexed Universal Life (IUL) policy will lead to a much greater retirement (see below for further details).
Ginn Insurance works with many HR Departments and Benefits Specialist to help incorporate this as an alternative to your 401k. These plans aren’t cookie cutter products either; We custom build each plan for the individual! We’d enjoy helping you add this to your retirement planning portfolio. Contact us for details. Details below outline some of the many key differences (advantages) of making this part of your individual or company’s plan:
| Tax Deferred Investments 401(k)'s, SEP IRA's and Traditional IRA's | Versus | Tax Free Investment Equity Indexed Universal Life Insurance |
|---|---|---|
| Limited Funding | Unlimited Funding |
|
| Taxation Guaranteed | Money Grows Tax Free | |
| Increased Market Risk (you absorb market risk) | No Market Risk (carrier absorbs market risk) | |
| Can Lose Principal | Can’t Lose Principal | |
| Wall between You and Your $$$ Until Retirement | Access to your $$$ at any time without penalty | |
| 10% Access Penalty under age 59 1/2 | Loans repaid on your schedule | |
| No Death Benefit | Death Benefit | |
| Triggers taxation of up to 85% of Social Security Income upon withdrawal | Tax free income at retirement and no impact on Social Security Income | |
| Higher taxes in 20-30 years which increases your tax bill. | No additional taxes at Retirement | |
| Negative Returns (Disaster for Retirement) | No Negative Returns. Guaranteed returns for downside protection and market index returns for upside potential | |
| No more "Open Enrollment" and dealing with a new set of mutual fund that are designed to "Out Perform The Market" | Tracks the market index you choose! No Open Enrollment Issues. No wondering if you're in "The Best Fund" |
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| Yearly Fees of 3% to 5% (if you're lucky) which are compounding and hidden in fine print. | Purchase a policy and you're done! Compounding Growth not Compounding Fees!! |
Looking to the right at the IRS Social Security Tax Rates (on this page), you’ll see one HUGE reason to incorporate an EIUL policy as an alternative to your existing 401k. Once you start drawing on your 401k to supplement your Social Security, you’ll trigger major tax consequences for yourself. This is a tax trap Uncle Sam has set for you and he could care less if you’re aware because he has major bills to pay and he wants your (his) retirement money for the National Debt Reduction!
I had no idea that another vehicle could have this many advantages over a 401k. That is very impressive.
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