Federal Advantage Benefit Company

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Thrift Savings Plan May Not Be the Best Retirement Plan

Thrift Savings Plans (TSP) are offered to federal and government employees when they’re hired, but did you know that there are other retirement savings plans that could benefit you more? The government has placed many restrictions on Thrift Savings Plans to make it harder for you to access your money when you need it, and there are no guarantees that you won’t lose some of your retirement money. Index universal life insurance (IUL) has fewer restrictions and can guarantee you a tax-free retirement income.

TSPs limit the amount you can contribute to the plan and how much you can take out at one time. There are also rules about who is granted tax-deferred status and at what age you can access the full amount of the plan. In order to take money out of the plan, both you and your spouse have to give consent, and you’ll have to pay it back under their rules. One of the biggest problems with TSP is that most plans are subject to market risk, so you could lose money if the market drops. Your money isn’t in a safe place with TSP and you have to abide by strict rules to get to the money you’ve worked for.

With index universal life insurance, you don’t have to worry about security and restrictions. The premiums and benefit amount are flexible, allowing you to customize your own retirement plan. You can also choose not to pay back any of the money that you withdraw from the policy as long as it is active. The two major benefits of IULs are that there is no market risk and the money you take from the policy is income tax-free. You won’t lose money and you don’t have to worry about heavy taxes on your retirement savings. IUL plans allow you to access the money whenever you need it, so you don’t have to wait until you reach retirement age to use your funds. You also don’t need your spouse’s approval to take money out of the policy (but you may want to mention it).

To learn more about how you can benefit from an index universal life insurance savings plan, visit our retirement page or fill out the form to the right. Our knowledgeable agents can help you customize your retirement plan.

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