A very common scenario we are presented with is one where clients acknowledge the need for life insurance for estate planning or wealth transfer planning purposes, however, they do not want to infringe upon current cash flow in order to fund the ongoing premium obligation.  Fortunately, many of them have accumulated substantial amounts of money in their qualified plans and will not need the required minimum distributions for retirement.  Many of these clients plan on leaving their 401(k) or IRA balance “to the kids”.  What they do not realize is that while quaified plans are excellent accumulation tools, they are inefficient transfer tools.  These funds are an ideal place to start when identifying a potential source of premium dollars for the needed life insurance coverage.

 

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IRA Max Presentation – August 2015 Newsletter