You both buy $250k and one partner subsequently dies.
The surviving partner uses $30,000 ($25,000 after tax) to replace your income for the family
The fund lasts 10-12 years and your partner receives zero help for retirement.
You buy a joint $1M on your lives and one subsequently dies
The surviving partner invests the money conservatively and takes $30,000 ( $25,000 after tax ) to replace your income for the family.
The fund lasts and, at retirement,your partner has $1M to buy a guaranteed- for-life annuity.
If there are young children and the surviving partner cannot work to save money for retirement,where does the money for retirement come from?
Look At What You have Done
- You have turned life insurance into an annuity.
- You have turned the insurance premiums you paid into $ 1 million cash.
- You cannot accumulate tax-free $1 million, by saving.
- Annuity retirement income is now guaranteed.