When talking with people about their insurance and financial matters, we've noticed that many of the same concerns rise to the top. Do you share any of these concerns?
- How will future tax increases impact me?
- As it stands today, could I retire comfortably?
- Will the changes in Social Security benefits impact my lifestyle in retirement?
- Will the volatility of the stock market impact my variable products or retirement plans?
- Do I have the flexibility to be able to modify my life insurance and financial decisions as changes in my life or budget occur?
Universal Life insurance can help protect your family from the uncertainties of life. Its flexibility, guarantees1 and tax advantages have stood the test of time. Properly managed, it can provide a lifetime insurance protection or a future source of income you can depend upon.
Increasing Taxes — During periods of uncertain taxation, it can be wise to look for ways to shelter as much of your money as possible. By doing so, you can maximize your money for the future.2
Solution: As you pay premiums, your policy's accumulated value earns tax-deferred interest, helping you maximize your funds during your pre-retirement years. When you decide to retire, you can use your accumulated value as retirement income in a tax-advantaged manner.3,4 And upon your death, your family or business partners (know as beneficiaries) will receive policy proceeds income-tax-free and generally without the costs or delays of probate.
Uncertainty of Social Security — It's true that the future of Social Security is unclear. It's naturally difficult to predict what, if any, retirement income you can count on. So taking control of your financial future is more important than ever.
Solution: You can contribute additional funds to your policy's accumulated value that can be used as supplementary income for retirement or other needs in the future. In fact, our Universal Life product has about 10% higher accumulated value after 20-30 years than other Universal Life products on the market today (assuming adequate premiums are paid to cover the cost of insurance over the life of the policy).
Annual Household Income — Whether you're self-employed or not, your annual income may disqualify you from contributing to a qualified plan, such as an IRA, thus preventing you from putting additional money away for the future.
Solution: There are no annual income limits that would prevent you from contributing to the accumulated value of your Universal Life policy. You may pay any amount at any time within the maximum limit set by tax law, provided your premium is sufficient to maintain your coverage.
Volatility — Due to the volatility you likely experienced in the stock market with your retirement plans or variable products, your preference today may be for more stability and preservation of your principal.
Solution: Universal Life has no market volatility. As you pay premiums, the money in your policy's accumulated value earns a competitive interest rate - of 5.4%5 - with a 3% guaranteed minimum rate.6
Flexibility — As your life changes or you experience unexpected events, you need to be able to adjust your coverage and premium amounts as necessary.
Solution: With Universal Life, you can increase or decrease your coverage as your needs change throughout your life.7 As your income or budget changes, you can adjust the amount and timing of your premiums. In addition, you can access your policy's accumulated value through partial withdrawals and loans if you need additional funds. Also, if you unexpectedly experience a total disability, terminal/chronic illness or confinement to a nursing home, it can protect you from future premiums or you can access a portion of your policy proceeds if necessary for related expenses.
To help you determine if Universal Life insurance is the right choice for you, simply contact your local Farm Bureau agent.
1 The guarantees expressed here are based on the claims-paying ability of Farm Bureau Life Insurance Company.
2 Neither the Company nor its agents give tax, accounting or legal advice. Consult your professional advisers in these areas.
3 Partial withdrawals are subject to a fee of $25 or 2 percent of the accumulated value withdrawn, whichever is less. For the first 10 years of the Universal Life policy, and for 10 years following an increase in coverage, full surrenders are subject to a current surrender charge based on policy year, age, sex and underwriting category. Surrender charges may be waived if eligibility can be established due to the insured’s terminal illness, total disability or stay in a qualified nursing care center for 90 consecutive days (after the first policy year).
4 Any loans from the policy’s accumulated value will reduce the policy’s accumulated value and death benefit if the borrowed funds, plus interest, are not repaid by the time of your death. For the Universal Life insurance policy, the Company currently offers a Zero Net Cost Loan feature after 10 years on the gain in the policy. Zero Net Cost means that the credited interest rate will equal the loan rate on the portion of the loan that equals the gain in the policy.
5 The interest rate as of 9/1/2010. This rate is not guaranteed and is subject to change at any time.
6 This rate is the guaranteed minimum interest rate you can receive on your Universal Life policy.
7Subject to insurability and IRS regulations