What is overfunded life insurance? Do you wish to know more about cash value life insurance? Are you looking for the best whole life insurance policy? Read on for some helpful tips and information regarding life insurance.
What are Overfunded Life Insurance Policies?
Overfunded life insurance is a policy that maximizes cash value and minimizes death benefits. The idea is to build cash value quickly that you can access for any reason during your lifetime. This cash value grows predictably and safely.
Before You Purchase Overfunded Life Insurance
Before buying this policy, you need to answer some important questions. You should probably ask yourself what purpose the policy will serve while you are alive. Ask yourself what the funds would be used for and when you plan to access the cash value. Can you fund the policy even in bad economic times? These questions will help you understand what exactly you are bargaining for.
Access to the Cash Value
When do you plan to access the cash value? This question will significantly influence your choice of overfunded life insurance policy and determine if it is right for you. You may seek not to access the cash value, while someone else may wish to access cash value for retirement, or in 10 years, or as soon as possible.
Your No Access Options
If you do not plan to access the cash value of investing with life insurance, overfunded life insurance may not be right for you. You will be overpaying for a life insurance benefit that you will not be harnessing. Instead, a universal life insurance policy is a good option. Universal life insurance policies have a cash value that help keep premiums at a constant level into the later years.
Another life insurance option that might work well for you if you do not plan to access the case value is a term life insurance policy. It offers cheap coverage for a certain period, typically ten, twenty, and thirty years or extended periods with some companies.
Cash Value Access for Retirement
Overfunded life insurance may be right for retirement, but if you do not need the cash value in the early years of your policy, a traditional whole life policy could be the most ideal. If you are between the ages of 50 – 60, it would be better if you opt for a limited pay style policy.
Ten Years Cash Value Access
Most overfunded life insurance policy designs come with a lower death benefit and substantially more cash value in year one.
As Soon As Possible Cash Value
For this purpose, an overfunded life insurance policy may be ideal as it accumulates strong early cash value. It is called the Legacy High Early Cash Value (HECV)
Although overfunded life insurance is not ideal for everyone, it offers benefits that meet certain needs. You need to ascertain if it is right for you. If you have any additional questions about overfunded life and personal insurance, contact the experts at Gant Insurance Agency in McKinney, Texas. We are ready to help you with all your coverage needs today.