When it comes to protecting yourself and your family, holistic protection is key. There are many ways you can prepare for the unexpected and help ensure your family is protected from life’s “what if” moments. Creating a financial strategy that includes both life and disability insurance (DI) is a critical first step. By having both permanent life and DI, you can have confidence, knowing that you are prepared for the unexpected.
As you may know, there are many benefits of owning a whole life insurance policy such as the guaranteed values and dividends that it can provide. But, there are a variety of ways you can use those guaranteed values and dividends, including to help offset your life and DI premiums. 1, 2 This strategy is called a “Double Premium Offset” and it works by using a Whole Life 99 (L99) policy as a tool to help offset your life and DI premiums while also providing many tax benefits.
By implementing a Double Premium Offset strategy, not only do you have the holistic protection of permanent life and DI, you also have a tax-deferred buildup of cash value in the whole life policy3, access to policy cash values on a tax-favored basis4,5, an income-tax-free disability income benefit and an income tax death benefit to your beneficiaries. What’s more is that you don’t need to pay premiums out-of-pocket after the offset year. At Parkes Financial Group, let us help you decide if a double premium offset strategy is a smart choice for you and your family.
View this flyer to see how a double premium offset strategy can work for you.
1All whole life insurance policy guarantees are subject to the timely payment of all required premiums and the claims paying ability of the issuing insurance company. Policy loans and withdrawals affect the guarantees by reducing the policy’s death benefit and cash values.
2Dividends are not guaranteed. They are declared annually by Guardian’s Board of Directors.
3Some whole life polices do not have cash values in the first two years of the policy and don’t pay a dividend until the policy’s third year. Refer to the individual whole life policy illustration for more information.
4Guardian, its subsidiaries, agents and employees do not provide tax, legal, or accounting advice. Consult your tax, legal, or accounting professional regarding your individual situation.
5Policy benefits are reduced by any outstanding loan or loan interest and/or withdrawals. Dividends, if any, are affected by policy loans and loan interest. Withdrawals above the cost basis may result in taxable ordinary income. If the policy lapses, or is surrendered, any outstanding loans considered gain in the policy may be subject to ordinary income taxes. If the policy is a Modified Endowment Contract (MEC), loans are treated like withdrawals, but as gain first, subject to ordinary income taxes. If the policy owner is under 59 ½, any taxable withdrawal may also be subject to a 10% federal tax penalty.
2022-135419 (Exp. 03/24)
Dave works with hundreds of Bay Area dentists, physicians and their families. He has a deep understanding of the financial needs of the medical/dental practitioner. He makes planning simple and clear by coordinating both business and personal finances for his clients.
He also works with Silicon Valley executives, professionals, and their families.