Introducing Lafayette Life’s Owner Benefit Plans
Introducing Lafayette Life – a mutual company established in 1905 with a solid track record of providing dividend-paying whole life. Their Product Portfolio consists of a number Par Whole Life polices as well as convertible term. They are A+ rated with a 96 Comdex score and are part of the Western and Southern Financial Group.
Owner Benefit Plans
Lafayette is unique in that they with help design and implement so-called “Owner Benefit Plans” – that is qualified retirement plans designed to maximize owner value and contributions. You may take advantage of their in-house TPA’s design expertise or use your own preferred administrator.
If you have business owners that are looking to increase their tax deductions and contribute more to their own retirement then we suggest getting a proposal request over to us for Lafayette’s Qualified Plans team. They can design a plan that maximizes deductions and contributions based on the client’s unique needs.
Their business owner benefit plans:
Must comply with ERISA rules for employee participation
May include life insurance
Can be implemented by any type of business entity
Can provide for guaranteed retirement income (DB plans)
May help alleviate the risk of reduced income at retirement
May include guaranteed issue life insurance for 5 lives or more
Infinite Banking
Another strategy that works well with Lafayette Life’s product portfolio is “Infinite Banking” utilizing Whole Life Policies as a means to create a personal banking system. The idea behind infinite banking is to maximize the benefits of a whole life insurance policy by leveraging its cash value component to create a source of financing for various needs and investments. The product of choice is the Patriot 2022. It is a whole life insurance policy designed for limited premium payments with early cash-value growth and accumulation. When used in conjunction with the Level Premium Paid-Up Additions Rider or Fixed Premium Paid-Up Additions Rider, offers early cash-value accumulation and the ability to access the cash value through partial surrenders, and the ability to borrow against the cash value through loans.
Case Study:
Dave, a 45-year-old father of three, can afford to spend $12,000 per year on a whole life insurance policy to protect his family. Dave decides to purchase a Patriot policy with a death benefit of $100,000 and a $100,000 20-year term rider. Dave also elects the optional Level Premium Paid-up Additions rider to enhance the potential cash value accumulation in his policy. Dave could use the cash value in his policy to help supplement the cost of education for his three children or to help supplement his retirement income needs.
Key Benefits of Infinite Banking:
Tax Advantages: Policy loans from a whole life insurance policy are generally tax-free, making them an attractive option for accessing funds without triggering tax consequences.
Control and Flexibility: You have control over your banking system, allowing you to dictate when and how you borrow funds. There are no credit checks or loan approvals required.
Conservative Growth: Whole life insurance policies provide steady and predictable growth, making them a relatively stable asset.
Legacy Planning: In addition to serving as a financing tool, the policy provides a death benefit that can be passed on to beneficiaries.