When most people think about healthcare planning, they focus on insurance or health savings accounts. But there’s another powerful tool you might be overlooking—an Indexed Universal Life (IUL) insurance policy. While IUL is typically associated with life insurance, it offers a lot more than just coverage. It can play an important role in making sure your healthcare needs are met, both now and in the future. Here’s why it should be part of your plan.
Healthcare costs are always on the rise, and they can quickly add up, especially if you need long-term care or have unexpected medical expenses. Unfortunately, traditional health insurance doesn’t always cover everything you might need. That’s where an IUL can step in and help.
With an IUL, the cash value of your policy grows over time. You can access this money to cover healthcare costs whenever you need it. So, whether you need help with medical bills, long-term care, or other healthcare expenses, having an IUL gives you another way to manage those costs without depleting your savings. Plus, it’s tied to a stock market index, so the growth potential is higher compared to other types of life insurance, yet it’s protected from market downturns.
Nobody likes paying taxes, especially when you're already dealing with medical bills. One of the big advantages of an IUL is that the cash value grows tax-deferred. This means you don’t pay taxes on it until you actually take money out. Even better, when you take a loan against the cash value of your policy, it’s typically tax-free.
This can be a huge help in managing healthcare expenses. With a tax-free loan, you’re able to access money without worrying about extra tax burdens. It’s a smart way to keep more of your money in your pocket, which is always helpful when dealing with rising healthcare costs.
Your healthcare needs will likely change over time, and you’ll want to make sure you have a plan that can keep up. One of the reasons IUL is such a great option is its flexibility. You can adjust your coverage, premium payments, and even the death benefit as your needs evolve.
So, if your healthcare costs increase, or if you want to boost your coverage as you get older, you can make those adjustments to your policy. This flexibility means you don’t have to worry about being locked into a plan that doesn’t fit your current situation.
As the cash value of your IUL policy grows, you have a built-in resource to tap into for healthcare costs down the road. The money grows over time based on a stock market index, which means there’s potential for higher returns than a traditional life insurance policy.
Having this cash value gives you a safety net for future medical expenses. If you need long-term care or have medical bills in the future, you can borrow against your policy’s cash value without triggering penalties or taxes. It’s an easy way to help cover costs when they come up, so you’re not scrambling to find money elsewhere.
Long-term care is something most people don’t want to think about, but it’s important to plan for. If you need nursing home care, home health services, or other extended care, the costs can quickly add up. Unfortunately, traditional health insurance doesn’t cover long-term care. But with an IUL, you can have access to a portion of your death benefit for long-term care or critical illness, depending on your policy’s terms.
Some IUL policies come with riders that allow you to use your life insurance for care if you’re diagnosed with a critical illness or need long-term care. This means you can have peace of mind knowing that even if your health takes a turn, your policy can help you manage those expenses.
Taking care of your health is about more than just staying active and eating right—it’s also about being prepared for future healthcare needs. As medical costs continue to rise and long-term care becomes more of a reality for many, it’s important to have a plan in place.
An IUL can be a smart option here, offering the ability to build cash value over time that can be accessed for healthcare expenses down the road. It’s a flexible option that grows with you and your needs, helping to provide a financial cushion if you find yourself facing unexpected healthcare costs in the future.
NPPSS focuses on helping you understand how these tools work in the bigger picture of your health and financial planning. Our team takes the time to break things down in a straightforward way, so you can make informed decisions about your healthcare and ensure you’re ready for whatever comes your way.