IFAs are popular for high-net worth individuals as a tax-efficient way to purchase life insurance or as a tax planning strategy. IFAs allow both individuals and business owners to finance a life insurance policy to create tax deductions and ultimately transfer assets tax-free to beneficiaries, substantially decreasing estate taxes. The cash value of a tax-exempt life insurance policy grows on a tax-deferred basis.
The key components of an IFA are as follows:
The business will then make contributions in excess of the premiums required by the life insurance policy. This excess will build cash value on the insurance policy over time. The funds can be used to invest on a tax-deferred basis, and also the policy itself can be used as collateral for a loan.
Typically an IFA would have the following outcomes:
Some factors which need to be taken into account when adopting an IFA strategy include:
From Royal Rock’s experience in structuring IFAs, only 50% of the applicants can qualify for the IFA. To get you started, Royal Rock will help you achieve the following:
With Tony’s long experience with IFAs, Royal Rock can undoubtedly help put in place the right strategy to achieve optimum results for all your financial planning needs.
Your path to a more secure financial future is only a phone call away. To get started, fill in the contact form or call at 778-288-1587. we can get to know each other through an in-person or virtual consultation.