Life Insurance

A New Look at Estate Planning

Presented by Brian Leising Congress set the new estate tax threshold at $5,000,000, but your clients don’t have to be multi-millionaires to benefit from basic estate planning.  They may not be subject to the estate tax, but there are plenty of other taxes, fees and delays you can help your clients avoid upon death. Here are two simple ideas you can use with just about anyone. Beneficiary designations A beneficiary review can uncover many problems.  If minor children are named as beneficiaries, the courts will decide who distributes the money and how.  They will do what is most convenient to the court, not what the client’s wishes might have been.  If the insured’s estate is named, it will cause a non-probate asset (life insurance) to go through probate.  This causes delay and increases settlement expenses and attorney fees. A producer who offers to help make sure beneficiary designations accomplish what clients want will become a trusted advisor – and the beneficiary of new business, cross-sales and referral introductions. Wealth Transfer Some individuals have more money than they need to live on during retirement.  If they have tax-qualified money, heirs may be forced to pay ordinary income tax on estate distributions upon their death.  A strategy that clients can consider is to pay the tax today on all or part of the qualified money, before the money accumulates further and poses a greater tax burden in the future.  Repositioning the money inside a life insurance policy will give heirs a tax-free benefit and the death benefit will more than make up for any taxes due today.
Life Insurance

What the Most Successful Advisors Do

Presented by Life Marketing A presentation was recently held about “What the Most Successful Advisors Do.” It certainly covered a lot of ground, but here are a few of the great take-aways. The Successful Advisor perfects the presentation…the Unsuccessful One wings – it! The Successful Advisor makes scripts to always say the right phrasing in meetings, on the phone and other sales situations.  The Unsuccessful One stumbles and mumbles. The Unsuccessful Advisor will try all kinds of things…Seminars, Leads, Networking and Community Groups. The Successful Advisor sticks with something long enough to perfect it and see results. The bottom line is this – successful people make plans to be successful and others who do not plan are falling into the proverbial “planning to fail” category.

Qualified Retirement Plan Tax Advantages

Presented by Jim Guynan In order to encourage saving for retirement, qualified retirement plans offer a variety of tax advantages to businesses and their employees.

The most significant tax breaks offered by all qualified retirement plans are:

  • Contributions by an employer to a qualified retirement plan are immediately tax deductible as a business expense, up to specified maximum amounts.
  • Employer contributions are not taxed to the employee until actually distributed.
  • Investment earnings and gains on qualified retirement plan contributions grow on a tax-deferred basis, meaning that they are not taxed until distributed from the plan.

Depending on the type of qualified retirement plan used, other tax incentives may also be available:

  • Certain types of qualified retirement plans allow employees to defer a portion of their compensation, which the employer then contributes to the qualified retirement plan. Unless the Roth 401(k) option is selected, these elective employee deferrals are not included in the employee’s taxable income, meaning that they are made with before-tax dollars.
  • Qualified retirement plan distributions may qualify for special tax treatment.
  • Depending on the type of qualified retirement plan, employees age 50 and over may be able to make additional “catch-up” contributions.
  • Low- and moderate-income employees who make contributions to certain qualified retirement plans may be eligible for a tax credit.
  • Small employers may be able to claim a tax credit for part of the costs in establishing certain types of qualified retirement plans.