Are you looking for a way that you can save up for retirement, but also want the benefits of life insurance? If so, an indexed universal life insurance may be a great option for you. Here is what you need to know about this alternative form of life insurance.

The Tax Benefits

Since an indexed universal life insurance policy allows your income to grow tax-free and be withdrawn without taking taxes, it provides huge benefits over other ways that people save up for retirement. Your beneficiaries will even receive the death benefit tax-free when that day comes. You will always know exactly how much money is in your policy and how much you have access to, all without worrying about taxes.

In addition, those withdrawals from your indexed universal life insurance policy are not going to raise your income levels either. You'll be able to withdraw from the policy and not have the upper end of your income be taxed by falling into a new tax bracket. This allows you to retain more of your social security income if you live in a state that taxes what you receive. 

The Minimal Risk

Your indexed universal life insurance policy is tied to a stock market index. It's not invested in the actual stock index, but your money grows according to how the index grows. However, there is a cap on how much your money can grow based on the index you've selected. The upside to this is that there is an opposite cap if the market does poorly, and you do not take losses in poor-performing years. This can give you peace of mind that your policy will never lose money when the stock market is performing poorly. 

The Living Benefits

There are ways that allow you to get access to your death benefit while you are living so that a financial burden is not put on you or your loved ones. In addition, you get access to that money tax-free. You can gain access to the money if you need long-term medical care or have a critical or terminal illness, which tends to have big medical bills that can drain people's bank accounts. 

Not sure if you should get an indexed universal life insurance policy? Reach out to an insurance agent in your area that can walk you through the policy and how it will work for your unique needs.