Simplify Spotlight: Filling the Retirement Income Gap
The Post-Retirement Income Gap client presentation, which illustrates how Whole Life can help fill the retirement income gap for high income earners, is now available through Simplify, a powerful, case design presentation tool brought to you by MassMutual Strategic Distributors (MMSD) Advanced Sales.
High income earners may experience a significant decrease in income at retirement due to the limits placed on contributions made to an employer-sponsored retirement plan during the working years. Although catch-up contributions (as of 2023 an additional $7,500 per year) are permitted for plan participants who are age 50 and older, the Secure Act of 2022 changed the catch-up rules, which may make it even harder to contribute additional amounts to retirement plans.
One way high income earners can address the retirement income gap is to consider the purchase of whole life insurance to cover family insurance protection needs during the working years. At retirement, the policy’s available cash value can be accessed on a tax-advantaged basis to help fill a portion of the income gap.1
Unlike some other types of permanent life insurance, the cash value of whole life insurance does not fluctuate as a result of events in the financial markets.
Adding whole life insurance to a financial strategy offers the following advantages:
- It provides income tax-free life insurance to help protect the loss of income to the family, while the client saves for retirement.
- Never declines due to market conditions and may be a reliable source of supplemental income during retirement.1
As a reminder, you now have direct access to Simplify. Access the website today and easily download the desktop app.
1 Distributions under the policy (including cash dividends and partial/full surrenders) are not subject to taxation up to the amount paid into the policy (cost basis). If the policy is a Modified Endowment Contract, policy loans and/or distributions are taxable to the extent of gain and are subject to a 10 percent tax penalty if the policyowner is under age 59½.