Keepin' It Tax Free

Your savings can be taxed if you set your life insurance up incorrectly.

Simply put, when you deposit “too much” into a life insurance policy, you create a “Modified Endowment Contract” (MEC.)

So, what are the disadvantages of a MEC?

Any gains you make in your policy will be taxed at your individual tax rate upon withdrawal
There’s a 10% early withdrawal penalty if you try to take out before 59.5
Because of the 10% penalty, your money is less accessible

Worst part?

Once your policy has been established as a MEC, it’s impossible to overturn.

So, how do we avoid converting our policy into a MEC?

In today’s episode, you’ll discover how to make sure your policy remains tax free forever.

Listen now!

Show Highlights Include:

How converting your policy into a “MEC” forces you to pay income tax on the growth of your savings (1:03)
How the same death benefit can cost you either $50 a month or $200 a month and what the difference is (4:59)
How to avoid paying any agents or brokers fees when investing in a whole life insurance policy with “paid up additions” (6:06)
Why shrinking your policy’s death benefit legally allows you to receive a higher payout when you retire (11:15)

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