Permanent life insurance that builds tax-free cash value tied to market indices, with a 0.25% floor so you never lose to a down year.
An IUL is a permanent life insurance policy with a cash value component that grows based on the performance of a market index, typically the S&P 500. But unlike investing directly in the market, you can never lose value in a down year.
Each year, your policy is credited based on the index's gain, up to a cap rate (typically 10–12%). In a down year, you're credited 0.25%, not negative. Your principal is always protected.
With a 10% cap and 0.25% floor on a $500,000 policy:
| Year | S&P 500 | IUL Credit | 401k Impact |
|---|---|---|---|
| 2019 | +28.9% | +10% (capped) | +28.9% |
| 2020 | −6.4%* | +0.25% (floored) | −6.4% |
| 2021 | +26.9% | +10% (capped) | +26.9% |
| 2022 | −19.4% | +0.25% (floored) | −19.4% |
*Mid-year dip. In down years the IUL locks in $0 loss; the 401k takes the full hit.
Access your cash value through policy loans, income the IRS never taxes. No required minimum distributions, ever.
Gains capped at 10–12% annually. Losses floored at 0.25%. Your money only goes up or stays flat, never backwards.
Adjust your premium payments based on your cash flow. Increase contributions in good years, reduce in lean years.
Access a portion of your death benefit early if diagnosed with a chronic, critical, or terminal illness. No extra cost.
Unlike term life, an IUL never expires. Your beneficiaries receive the death benefit tax-free regardless of when you pass.
Unlike a 401k ($23,000 limit) or Roth IRA ($7,000 limit), you can contribute as much as the policy structure allows.
The 401k was designed in 1978 as a supplement to pensions, not as a primary retirement vehicle. Today, most Americans depend on it entirely, unaware of the tax exposure, market risk, and fee drag waiting for them in retirement.
