Posts Tagged Insurance

Paying Final Expenses or Replacing Income Isn’t the Only Job of Life Insurance

February 12th, 2018

In Fact, It’s Just the Start.

Regardless of how long you’ve been in the life insurance business, it is likely that you regularly discuss with clients the need for this type of coverage as it relates to replacing income for young families and / or the way that it can provide loved ones with peace of mind in knowing that funeral and other financial expenses will be taken care of.

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Factors to Consider When Spending 529 Plan Funds

February 5th, 2018

For many parents (and grandparents) of future college-bound students, a 529 plan has been a key part of their overall college savings strategy. But, even though these financial vehicles can provide some tax-advantaged methods of saving for future education costs, they can also come with a long list of stipulations to abide by. And in many cases, this plethora of rules can make it much more difficult to know what is, and what isn’t, allowable in order for the plan to keep its tax favored status.

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Does Life Insurance Fail as a College Savings Vehicle?

January 22nd, 2018

In the overall realm of financial services, you would be hard pressed to find anyone who truly revels at the thought of talking about life insurance. One reason for this is because most people don’t want to dwell on what it would be like when they are gone.

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Life Insurance Versus the 529 College Savings Plan

January 15th, 2018

Which Will Provide the Best Outcome?

For many people, having a college degree can help to provide them with better job opportunities, which can also mean more choices. Unfortunately, getting that degree can come with a hefty price tag.

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How to Set Yourself Apart in Your Clients’ Minds

January 8th, 2018

Regardless of how long you have been involved in the insurance business, you are likely well aware that there are many, many other insurance and financial professionals who are offering the exact same products and services that you do.

So how is it, then, that some of these advisor’s struggle from one month to the next, while others seem to effortlessly earn top dollar?

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No Funding Limits on Tax-Advantaged College Savings?

December 26th, 2017

Yes, It Is Possible

As we move towards the end of another year, many investors are thinking about how they can make the most of their tax-advantaged savings accounts – and for anyone who is assisting children or grandchildren with funding their higher education in the future, this may include college funding plans. One of the most popular of these is the 529 college savings plan.

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Can Life Insurance Really Pay for a College Education?

December 4th, 2017

Many parents – regardless of whether their children are newborns, toddlers, grade schoolers, or even in their early high school years – worry about the consistently rising cost of college education. And this is a very viable fear.

According to Inside Higher Ed, one year at a public two-year college, for the 2017-2018 school year, averaged $3,570, while private non-profit four-year institutions averaged nearly $35,000 per year.1 So, over a four-year time period, many parents could be facing a price tag that rivals that of a home mortgage…or worse.

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A Safer Alternative for College Planning

December 1st, 2017

For years, most people have been led to believe that the money placed inside of qualified plans – such as those that are used for retirement and college savings – should be invested in volatile financial vehicles like stocks and growth mutual funds. One of the primary reasons for this is because these types of investments can oftentimes better meet or beat inflation due to their POTENTIAL for a higher return.

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Using Life Insurance to Save for College?

November 10th, 2017

The Policy Used Can Make a Difference

With the cost of a college education raising rapidly, parents and other loved ones who want to help out with a child’s future college expenses are seeking options. One of those possibilities is using life insurance.

But, while this financial vehicle can provide numerous college savings-related advantages, not all life insurance plans are created equal. So, it is important to ensure that clients who opt to use life insurance for college education costs are going with the proper option for their needs.

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How Trumpcare Could Impact Other Areas of Insurance and Financial Planning

April 5th, 2017

In early March 2017, President Trump and Congressional Republicans released the American Health Care Act, which was intended to replace the Affordable Care Act (aka Obamacare). Although this plan did not garner enough votes to pass, the GOP aims to continue its promise and bring TrumpCare to fruition one way or another.

While Trump’s plan, like Obamacare, primarily concentrates on health care and related coverage, it could actually have much more of an impact on life insurance and other financial planning aspects than many people think.

In fact, if it is passed, there are several key components to the Trump health care plan that could hit consumers directly in the wallet, either in a positive or a negative way. For example, one of the key changes would be to remove the individual tax on those who don’t purchase health insurance – which would be retroactive to year-end 2015.

This means that, should the Trump plan be approved, those who did not have health insurance coverage in 2016 would not be required to pay the penalty when they file their 2016 income taxes.

Should this be the case, though, it is estimated by the U.S. Congressional Budget Office that roughly 14 million people will cancel their health insurance coverage,1 also eliminating what could be a hefty premium payment for them.

But, even though this could ease the strain on the monthly budget for some consumers, for someone who is already dealing with a major health issue such as cancer or heart disease, it could also mean having to liquidate savings or investments in the future in order to pay medical related bills.

This is particularly the case for someone who endures a long, drawn out illness and who could rack up a significant amount of medical debt – debt that is so high, his or her survivors are not able to pay the bills that come due upon the individual’s death. It could also have a major impact on future expenses. This includes high dollar financial obligations, such as college tuition for a child or grandchild.

Life insurance coverage can offer a solution for the imbalance here. By having funds available that are received free of income taxation, heirs wouldn’t be as likely to fall into long-term financial hardship, even in the event of substantial expenses in the future.

Tuition costs have been on the rise for years, with no end in sight. In fact, according to the National Center for Education Statistics, the average annual cost for undergraduate tuition, fees, room, and board for the 2014-2015 academic year were over $16,100 at public institutions, and nearly $42,000 at private non-profit institutions.2

By placing money in the market to save for future college tuition costs, it’s anyone’s guess how much there will be – if any – at the time the child needs these funds. On top of that, depending on how a traditional college savings plan is set up, the money could be subject to taxation over time and / or at the time of withdrawal, essentially lessening the amount even further.

Using life insurance to ensure higher education costs can provide a solution. In the event of an insured’s death, the policy’s proceeds are received tax free by the named beneficiary. If, however, the insured is alive and well and the policy is still in force, funds from the cash value can be borrowed, tax-free, for college funding needs.

If this loan is not paid back, the insurance company will reduce the amount of the death benefit on the policy. However, that’s not necessarily a concern for those who are using the policy primarily as a college savings vehicle.

As it stands, even if President Trump’s health care plan is given the green light, it won’t likely take effect for some time. Talking with clients and prospects about their options between now and then can help them to put their own plans in place for moving forward.

We’ll show you the system that thousands of other insurance professionals have used to generate a substantial amount of income, while at the same time assuring clients that high ticket expenses will still be paid in the future – regardless of a long list of factors that are out of their control.



  1. “CBO Cost Estimate American Health Care Act,” CBO, March 13, 2017.
  2. National Center for Education Statistics. Fast Facts. (