Retirement Planning

You may be one of the fortunate ones; you’ve saved substantial income for your retirement. Or perhaps you still have a little ways to go to feel totally secure. One thing’s for certain: it’s important to make sure your money lasts comfortably throughout retirement so you can enjoy your post-working years to the fullest. Consider:

  • According to the Department of Labor, you can expect to spend at least 18 years in retirement.
  • You will need approximately 70 percent of your income to maintain your current living standard.
  • Seven out of 10 individuals believe they do not have enough money for retirement. Only one in 100 retirees has assets approaching or exceeding one million dollars and even that one person thinks he or she can do more.

Retirement Plans are not only very important tax planning and savings tool but, they are also one of the broadest topics of discussion. It can be hard to decide on how to structure your retirement plans to ensure maximum tax advantages and that your golden years are as comfortable as you desire. In this article we will discuss INCOME TAX DEDUCTIBLE savings vehicle like defined contribution & defined benefit pension plans and INCOME TAX DEFERRED vehicles like sec 7702 life insurance and annuities plans.

If you’d rather speak with a retirement specialist then call (877) 972-3262 or contact us now to find if you qualify for an income tax deductible plan or income tax deferred plan.

The first step in retirement planning is to calculate how much you need to save now.

The second important step in retirement planning is to choose where to invest your money and how to select the correct plan as well as how to avoid becoming a cautionary tale of someone who lost their entire savings in the stock market or other speculative investment.

There are essentially five retirement plans investment options:

  1. Stock-Market-Based investments such as individual securities, mutual funds, variable annuities, variable life insurance policies and managed money accounts
  2. Fixed Income Securities like Bonds, CDs, Fixed Deposits and fixed income like vehicles such as Fixed Annuity and GALIP Account
  3. Real Estate and Commodities like Precious Metals, Energy, Grains and Livestock
  4. Fixed and Indexed Annuities
  5. Cash value rich investment grade Cash Value Life Insurance Plans

Most financial planners, investment gurus and retirement planning experts agree on the RIGHT ASSET ALLOCATION of your retirement funds. The asset allocation denotes how much to invest in each of above investment options. Your asset allocation depends on many personal factors like your age, risk profile, investment knowledge, net worth and income. In general, a 60/40 or 50/50 split between and stock market and commodities-based investments (individual securities, stocks mutual funds, gold etc.) and safer or fixed-income investments (bonds, fixed annuities and whole life insurance) are widely accepted.

We believe traditional mutual funds and managed investment portfolios are very expensive due to high fees and commission. That is why our clients at BeamaLife are free to invest their side funds in no-load and very low fee indexed funds/ETFs or any other investment with online brokers like Vanguard, Fidelity, Charles Schwab, E-trade and Scottrade. We advise on your remaining 40% or 50% of retirement investment portion and help you find the most attractive and highest dividend-paying whole life insurance or highest interest paying fixed or indexed annuities.

Cash value-rich whole life insurance provides a very competitive rate of return without having to worry about stock market volatility. A whole life plan over the long term period provides 4 to 5% IRR (Internal Rate of Return). This return is a NET RETURN after all expenses including life insurance cost. Quite simply, whole life provides similar returns to investing in bonds BUT with additional life insurance benefit. Stock market-based investment returns are misleading when you compare them with whole life insurance as they (Stock Market or Mutual Funds) calculate GROSS RETURN and exclude expenses. When you compare the net return of stock market investments with net return of whole life plan then you will understand how important whole life insurance can be as part of your retirement planning strategy.

To qualify for whole life plan you need to be in good health and insurable. If you are uninsurable or cannot get any more whole life insurance, then fixed or indexed annuities are the next best retirement savings investment option. They have guaranteed interest rate returns and a guarantee of your principal investment very much like a CD so you won’t have to stress over stock market trends, bubbles and crashes.

Retirement planning is all about protecting your hard-earned money and making it grow by selecting the right retirement investment and we are committed to bringing you innovative ideas for your retirement savings that will help you build solid a retirement plan for your golden years. Our Retirement specialists can help you to take larger income tax deductions if you qualify, while building a solid retirement savings foundation for you in a fiscally prudent manner. Call (877) 972-3262 today to speak with an experienced advisor or complete the personalized proposal request form now.

If you want to enjoy a comfortable post retirement life, there is no better alternative to getting retirement funds like 7702 life insurance plan that ensures a steady flow of income even when you are not working. Remember, to maintain the pre-retirement standard of living, you will need at least 70 percent of your last income. Moreover, you need to ensure the flow of funds for at least 18 years, which is the span of life projected by the department of labor.

The types of pension funds are commonly divided into two categories such as income tax deductible retirement investments and income tax deferred plan. The latter option includes annuities and life insurance plan.

Retirement planning consists of two simple steps – the first step in retirement planning is to calculate how much you must save and the other step is to select the most suitable investment plan so that the investment is safe, but growth takes place. While the first step might be easy, take the next one with caution because striking a balance between risk and growth is a tricky job.

At BeamaLife, we believe that the ideal retirement plan must be tailor made because it depends on the financial capabilities and expectations of the person. Small business owners can invest in 401(k), Profit Sharing Plan, Defined Benefit Plans and 7702 Plans, but according to trend, the majority prefers the latter to the former.

The only consideration is whether the physician is employed at some place or if he or she is self-employed. The tax-deferred retirement planning for physicians will be slightly different from that of independent physicians in the choice of available investment options. The investment options for independent physicians are limited to solo 401 (k) plan/profit sharing plan or the Self Employed Pension Plan such as SEP-IRA and defined Benefit Plans. Whereas doctors who are in employment have wider options of investing in 401(a), 401(k), 403(b), government sponsored 457(b), Nongovernment organization 457(b) and NGO457.

At BeamaLife, we can provide the plan, but would also like to explain that it is not a traditional retirement plan like IRA or 401(k). Correctly understood, IRS Sec 7702 is an insurance based plan that borrows the features of Roth 401K and Roth IRA, but it is actually a high cash value life insurance plan. This plan allows insurance companies to use whole life insurance or indexed universal life as a retirement vehicle.

  • Investment in fixed income securities like fixed deposits, bonds CDs, and vehicles of annuity related income.
  • Stock market related investment in mutual funds, variable life insurance policies and individual securities.
  • Fixed and indexed annuities.
  • Investment in the commodities market and real estate.
  • Cash value life insurance plans.

Call us today, and we will guide you in selecting the most efficient retirement plan for you!