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Retirement Help

Almost Instant Retirement Cash

Chances are that there’s a little piece of paper hanging around your house, or maybe in a Safety Deposit box. It’s often overlooked and ignored.  You can cash in on this little “hidden” gem.  There are actually companies out there that will pay you a handsome portion for this little piece of paper.

Most folks have been paying for this for YEARS.  Despite that, they have nothing to show for it, but this little piece of paper and a promise.

WHAT am I talking about?  Your LIFE INSURANCE policy!  Did you know that there are companies out there that will give you money NOW in return for your life insurance policy?

Contact your insurance agent and they’ll take to you about surrender value or taking a loan out on your policy.  Both of these will get you SOME cash. But, a relatively insignificant portion.

There’s a better solution if you’re in need and have a policy that will pay out over $50K as a Death Benefit.

Yet, don’t think this is a magic bullet.  While the legality of doing something like this has been upheld by the Supreme Court, the industry operates in unregulated waters.  Not too many people even know about this concept, called a “life settlement.”   So, it is wise to do your homework and some thorough research on the firms you are dealing with BEFORE you even contact your first one.  Certainly, you should consult with the appropriate professionals prior to actually completing the transaction.

Yet, for some of you, this may very well be a way to get some much needed money to help fund your retirement years.

One other thing to consider: some life insurance policies allow you to get a portion of your benefits, some up to 75% of the amount due upon your death, PRIOR to your actual demise, in the event you are faced with a terminal illness.  So, check THAT option out FIRST if you happen to be in such a circumstance.

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Posted by Steve Maziarz - October 27, 2009 at 5:07 pm

Categories: Finance, Retirement Help   Tags: , ,

IRA vs. 401k Withdrawals

recently discovered something when transitioning jobs – should you need, or desire, to pull out some money from your retirement savings there is a BIG difference between an IRA and a 401k.  With a 401k, they are REQUIRED to withhold 20% Federal Tax.  However, if you roll over the funds in your 401k TO AN IRA and then request a withdrawal, they are NOT mandated to withhold the 20% Federal Tax.  That is a choice you can make for yourself.

In my case, by r0lling over to an IRA and then requesting a withdrawal, I was able to save around $1,800 in mandatory tax because I withdrew money.  PLUS, when I repay my “loan” within 60 days, by re-depositing the funds to my IRA, there is no Federal Tax penalty involved.  It’s as if the “loan”  never occurred.

The folks at Fidelity, who recommended and handled my rollover clued me in to a HUGE savings.  Perhaps they can do the same for you when the time comes.

Also, I’d like to pint out that the IRA offers much more flexibility in the investment vehicles offered.

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Posted by Steve Maziarz -  at 5:03 pm

Categories: Finance, Retirement Help   Tags: , , ,