Using life insurance for pension maximization
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The typical defined benefit pension plan may pose several challenges for your clients—mostly, a potentially lower monthly income during retirement, as well as a lack of flexibility to change the beneficiary or the election option. The pension maximization strategy can help your clients gain death benefit protection while making the most out of a pension plan.
- Needs death benefit protection and considering retirement
- Married, age 50 to 65
- Either spouse has a defined benefit pension plan
- Seeking to help maximize monthly income
- Prepared for the potential impact caused by loss of benefits for the surviving spouse that may be linked to the joint life option
- The participant is ideally several years away from retirement, which may lower premium costs based on age and health.
- Be sure the life insurance policy is in force before the client declines the joint and survivor option.
- When calculating the needed death benefit, consider a highly conservative approach (preparing for a scenario in which the plan participant dies soon after retiring).
- With some pension plans, selecting the life only option may disqualify the plan participant's spouse from medical or other benefits that may be provided with the joint and survivor option.
For help with your pension maximization cases, contact sales development at 800-800-3656 ext. 10411 or email firstname.lastname@example.org.
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