Tax Free Income on Steroids - from my Book
Can you get high returns and avoid taxes?
Yes you can with a Non-Qualified Tax Free Retirement Alternative Plan. And unlike the Roth Plan, you are not limited as to how much you can put in it each year and, if you are a high income earner, the NQ TFRAP may be your only way to receive tax free income at retirement.
In technical terms, it's an Indexed Universal Life Plan. But it's not just some ordinary life plan or Universal Life plan for that matter.
As the name would imply (Indexed) means that it's policy values inside the policy grow based upon the Indexed strategy we discussed in the previous chapter. So we win the first battle of Market Losses. They Never Happen.
The Second battle of Taxes is also won. Life insurance plans have always enjoyed a tax free death benefit, and money can be withdrawn by way of policy loans that is not considered income and is therefore not taxable... making it tax free. And just so we are clear, the build up during the accumulation phase is not taxable either like the qualified plans mentioned above. It's that good.
But not just any life plan does this as well as those plans specifically designed for the purpose of saving for retirement. For example, all cash value life plans offer policy loans. The method by which the retirement saver receives tax free income. But how are those loans made to the retirement saver? Some companies offer a 6% or 8% loan against policy cash values, but that would mean that the policy would either require that interest payments be made each year or a growing compound loan would accrue against the policy. If this happens, it is likely that income would stop and the policy would lapse at some time in the future. Something the retirement saver must avoid.
Our Non-Qualified Tax Free Retirement Alternative Avoids that. How? By Offering two "special" loan options; "Washed-Loans" and "Variable Arbitrage Loans".
Want to know more... Read the whole chapter at my website at: http://gorillaretirement.com/?page_id=60