More choices for your life insurance premium payments
Many investors face the problem of not wanting to utilize their liquid funds, assets, and bonds for simple things such as funding their life insurance, some investors dream big and want to save their cash for other opportunities, or they may wish to invest in other projects from where they would expect a higher return.
Whatever your situation, premium financing for life insurance is an ingenious and innovative financial strategy that is designed to help you buy large amounts of business and life insurances while leaving your cash and other assets in their place. Premium finance life insurance will let you reap the benefits of your assets and also have a pretty stable life and business insurance. This mode of financing will also help you leverage the benefits of borrowed funds while you can continue to acquire, grow, and preserve your other assets.
What Are The Benefits Of Premium Financing?
Premium finance life insurance is more beneficial for affluent individuals who would want to purchase life insurance to be able to leverage the value and tax advantages provided to them for their estate planning.
Business owners also benefit from premium financing by being able not to use their existing assets but at the same time being able to fund buy-sell agreements, gain executive benefits, and get key-person insurance.
Using the benefits of loans to pay your life insurance premiums will enable you to save on taxes and keep your investment options open for other opportunities. Paying life insurance premiums from borrowed money minimizes the money that goes out of your pocket.
Tax Advantages From Premium Financing
Premium financial Insurance offers several tax benefits; it helps keep gift taxes down; if your annual gift tax exclusion is exhausted, premium financing is an excellent option to keep your tax expense down. Smart investors harness the strength of premium financing to fulfill their needs of life insurance and at the same time, devise an effective exit strategy for the loan and thus allow large sums to be available in their trusts for other investing opportunities.
Premium financing helps you retain assets and avoid the need to sell securities in a falling market to raise capital to fund the life insurance premium.
Why should you get whole life insurance?
Premium financing for life insurance provides unbeatable benefits; no other financial vehicle provides guarantees, tax benefits, and leveraged tax benefits. Life insurance gives you:
- A guaranteed death benefit, which is income tax-free to all your beneficiaries.
- Guaranteed fixed premium
- Policies that you can benefit from and used as collateral for loans
- Cash values that grow tax-deferred
- Easy integration with personal and business strategies
- In the case of disability, the insurance can be self-completing.
A guaranteed death benefit is beneficial for your family. It gives many of us inner peace if we know that after our death, our families, or the ones we love, wouldn’t have to struggle financially. Premium financing is compatible and easy to mold, which means that you can freely use it in your business strategies and even in your personal financial planning.
The concept of premium financing is not entirely unheard of, what this mode of funding boils down to is a similar concept to that of buying two houses on loan instead of just buying one home with your own money. Similar versions of the ideas have gotten incorporated into different financing deals. The strategy, extensively being used in arbitrage derivatives, where investors trade on borrowed money with different global currencies on stock prices on specific options to gain the risk-free benefit and to be able to pocket the difference in rates.
Premium financing gives you benefits in a different form, through premium financing you can buy life insurance with a more substantial death benefit, more living benefit protection, and the opportunity to accumulate more cash benefits without any risk of losses due to the decline in the stock market. Using bank benefits can help you increase the amount of profit you can gain from investments
Compare Premium Finance to What You Could Afford Using Your Own Money
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