FAQ: Can I Use Life Insurance for Tax-Free Distributions?

Our priority and goal is to educate our customers and provide you with the best value, knowledge and industry updates! Today we’d like to share with you a few of the many ways you can use Life Insurance for Tax-Free Distributions.

Many people assume Life Insurance is only a benefit when a death occurs, but our mission here at Singh Insurance and Financial Services is to share the many additional benefits that Life Insurance can bring to the table. 

Here are a few questions to get you started…

  • What is your tax liability in retirement?
  • Will all your 401K be taxed in retirement?
  • Did you know that your social security can be taxed in retirement?
  • Have you maxed out your Roth?
  • Don’t qualify for a Roth?
  • Do you think taxes are going up?

Contact us to have a discussion about your Life Insurance policies. 

CALL 352-432-1646
EMAIL info@singhinsurancegroup.com

How much life insurance do I really need?

One of the most common questions about life insurance is "How much life insurance do I really need?" This question is so common that there isn’t one answer for everyone, and it is a complex issue that needs to be answered on an individual basis. At Singh Insurance and Financial Services LLC in Clermont, FL, we listen carefully to every customer to understand their needs and concerns. As an independent agency, we offer choices that make finding the right insurance easier. 

To figure out how much life insurance you really need, you have to answer some simple questions.

  • Who depends on your income? 
  • What is your yearly income? 
  • How much debt do you have?
  • Do you have enough savings to pay off your debts and your final expenses?
  • For how long do you need to provide for any dependent?
  • Is there any other reason you may want to have life insurance?

Dependents can be significant others, elderly parents, children, and other dependent relatives. If you are not there to provide your income, will they be able to support themselves?  If the answer is no, then your life insurance is what will fill in the gap. How long this needs to last depends on things only you know. Beyond these basic needs, you may want to provide a legacy for your survivors or make sure your children can afford to go to college. All these affect the amount of life insurance you really need. Discuss all these issues with your insurance agent to come up with a figure. 

When you are ready to review your life insurance at Singh Insurance and Financial Services LLC in Clermont, FL, we are here to help you find the insurance you need and want at prices you can afford. Call our office or stop by for a free quote. 

Choosing a Life Insurance Beneficiary

Making Tough Life Insurance Decisions

Choosing your life insurance beneficiary is an important decision. Here are some tips in order to help you avoid some common mistakes.

  • Remember the Purpose of the Policy: The reason you are buying the policy should be your drive in life. If you want to help your family financially, then your spouse can be a great choice. If you’re going to help your company, then choose your business partner.
  • Know Your Options: There are usually more options than just your kid or your spouse. An agent at Singh Insurance and Financial Services, LLC can help explain your options.
  • Have a Back-Up Choice: If your primary beneficiary can’t be found or is deceased when you die, then a secondary beneficiary should become the recipient. Make sure you think about this choice as well.
  • Keep It Up to Date: A common oversight is not keeping your beneficiary up to date. If you are married and previously listed your mother, your spouse won’t receive money to help with your household.
  • Avoid Having a Minor Be Your Beneficiary: It’s best to set up a trust or designate an adult you trust to distribute the money to a minor to avoid any lengthy processes.
  • Be Specific: It’s best to be as specific as possible when choosing. If you name your children and one of your kids dies before you do, do you want the remaining children to get the money, or do you want your deceased kid’s heirs to get some of the shares?

If you don’t name a beneficiary, then the life insurance policy is paid to your estate. If this happens, then the court decides how to handle the funds. This can be a lengthy process and can chip away at some of the funds. If you want the money in the hands of those who need it, always designate a beneficiary.

Contact Singh Insurance and Financial Services, LLC to get a quote on life insurance in Orlando, Tampa, and anywhere in the state of Florida.