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Can You Withdraw Money From A Life Insurance Policy?

John CasaSanta

Question: Is it possible for me to withdraw some money from my policy? from Joanne A. in Chicago, IL

Answer: YES!!!  Cash value life insurance policies are excellent ways to accumulate monies.  The great news is when you withdraw money from them they are considered tax free dollars.  During my twenty years of assisting families and business owners, I have established many “Tax Free” Retirement Plans.  By purchasing either a whole life or universal life insurance policy and contributing monies on a monthly or annual basis money can build up over time.  Families have used this concept to save for children’s college, a daughter’s wedding, a future vacation, etc.  Doctor’s and business owners have used this concept for the life insurance benefits along with building cash for retirement.  This is a great concept to save money on a tax free basis and be protected with life insurance at the same time.

You can also withdraw money from most annuity contracts.  The majority of annuities have a 10% free withdrawal provision that will allow you to take money out in case of emergency before you are ready to begin taking an income stream.  Keep in mind you will be required to pay tax on the interest gained when you make a withdrawal.

For additional information on how to establish a tax free retirement or to review your current life insurance and investments please give our firm a call or send us an e-mail.

Click here learn more from John CasaSanta.

About the Author:

John CasaSanta has been protecting families’ assets and providing life/health insurance for 21 years. CasaSanta Financial Services was established in 2003 with the sole purpose of assisting families in reaching their financial goals.

John can be reached by e-mail: John@casasantafinancialservices.com or at (704) 451-7020. You can learn more about John at www.casasantafinancialservices.com.

Insurance and annuities products offered through John CasaSanta. Insurance Licensed in NC, SC and IN.  NPN# 2475717. FL License #: W290849

 

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3 Comments

  • Mark Oser says:

    Its "tax-free" because its a loss. The government doesn't tax a loss. You're borrowing your OWN money & you're paying more interest to borrow than the insurance company is paying you in interest. Also, if you bundle your insurance with your savings when you die the company pays the life insurance amount , but they keep your savings. If you live & withdraw your money, you forfeit your life insurance protection. Great plan!

  • All cash value in a life insurance policy grows tax free. The only way these funds would create a loss is if a variable universal life insurance plan is selected. In this case if funds are needed and the market is in a down turn then the cash accumulation could be below the actual amount that was deposited. Our firm has assisted a large amount of business professionals and families with this concept using Universal Life Insurance policies that have accounts that are not directly invested in the stock market. Using this concept the accumulated cash value will not show a loss. We also provide an option that the cash value accumulated in the policy can be added to the death benefit upon the death of the insured. When structured correctly these policy have proven to be great way to create a Tax Free Income.

  • Great article and very well explained. I believe in professionals so this is a very useful article for everyone. Many thanks for your share.

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