What’s the return on a lifetime?
Your clients may think that their family could build more money for the future if they self-insure and invest their money in a product other than life insurance. But, have they looked at the internal rate of return life insurance can provide at death?
How does this strategy work?
By purchasing life insurance with a relatively small premium, your clients can generate a substantial death benefit, which can help them provide the assets needed to make sure their loved ones are financially secure. This works because life insurance provides leverage, so the internal rate of return for life insurance can be substantial, not only in the short-term, but all the way through life expectancy.
Strategy in action
- Peter is age 55
- He needs $1 million in life insurance
- He pays $11,450 per year in premiums for that benefit1
Here’s what another investment would have return annually (pre-tax) to keep pace with the life insurance benefit.
1 The life insurance values represented here are for a preferred, non-tobacco male, non-guaranteed and assume current charges and a current interest rate of 5.29%.
2 Based on a 35.00% income tax bracket.
- Age 50-70
- Needs insurance but isn’t convinced it’s a “good deal”
- Wants to provide a substantial benefit for children or grandchildren at death
- Is healthy and can buy life insurance at a reasonable price
Highlighted product(s) with this concept
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