A married couple in their mid-30s had two financial decisions approaching at the same time.
Their 10-year term life insurance policies were nearing the end of the original term period, creating an opportunity to convert some of their coverage to permanent life insurance without additional medical underwriting.
At the same time, the wife had approximately $168,000 in a former employer’s 401(k) that could be repositioned as part of their broader retirement strategy.
Rather than treat these as separate decisions, we looked at how they could work together.
For the life insurance, we compared:
10-Pay Custom Whole Life for permanent coverage, guaranteed cash value, and the potential for additional value through non-guaranteed dividends.
10-Pay Variable Universal Life for permanent coverage with market-based cash value growth potential and corresponding investment risk.
For the former 401(k), we compared:
A variable annuity for continued long-term accumulation, flexibility, and death benefit features. Premier Plus VA
A deferred income annuity designed to create future guaranteed lifetime income, with the potential for additional dividends if declared. FMIA Illustration
The objective was to create different financial resources for different purposes:
Retirement accounts for growth. Permanent life insurance for liquidity and legacy. Annuity assets for future income or additional accumulation.
By creating a dedicated source of legacy through permanent life insurance, the couple may feel more comfortable spending retirement assets later instead of trying to preserve a specific account balance for their children.
Two separate decisions can become more effective when coordinated.
The planning focus was simple:
More flexibility today. More spending confidence in retirement. A legacy already accounted for.
For educational purposes only. Client identifying information has been omitted or changed. Individual circumstances and results will vary. Life insurance and annuity products contain costs, limitations, and risks. Variable products are subject to market risk and may lose value. Guarantees are based on the claims-paying ability of the issuing insurance company. Neither New York Life nor its agents or affiliates provide tax, legal, or accounting advice.