ROI, ETF, IPO, SEC, HELOC, KPI, EPS, NAV—what??
Have you ever felt like finance has its own secret language? It can feel like a jumbled-up alphabet soup that’s more confusing than delicious. Well, it’s time to meet LASER Funds—the cool kid of all the wealth management acronyms.
But what is a LASER Fund? LASER is an acronym that stands for “Liquid Assets Safely Earning Returns.” It’s an unofficial name for a properly structured, maximum-funded indexed universal life (IUL) insurance policy. We’ll show you how regular people like you use them as tools for growth, flexibility, and even tax advantages.
It’s no fun being out of the loop on the lingo everyone else seems to know, so let’s demystify what seems like a complex financial tool and put it into simple terms.
What Does It Mean?
You’re probably here because you have an IUL insurance policy or are considering getting one, and you’re still a little confused about the term LASER that your Utah IUL specialist has mentioned.
Essentially, the LASER Fund is a term coined by an IUL industry thought leader to describe the advantages of this financial vehicle that’s excellent for maximizing financial growth, as it meets the liquidity and growth goals core to the LASER strategy.
As we said, the letters in LASER mean Liquid Assets Safely Earning Returns. Let’s break that down.
- Liquid Assets: These are funds you can access when needed. Think of the cash under the mattress or the money in your checking account that can be spent with just a swipe. Your money in an IUL is not locked away like a dragon’s treasure but is ready to use for anything, like tax-free emergency funds, working capital, retirement income, etc.
- Safely: Your policy’s growth is risk-managed, so it’s designed to weather market ups and downs. A LASER Fund prioritizes safety while allowing for the growth you want to see.
- Earning Returns: Your money can earn competitive interest tied to market performance, but it’s not directly exposed to the stock market’s volatility. This way you can earn when the market goes up, while being protected with a 0% floor when the market goes down.
It’s handy in almost any situation and serves many financial needs, from wealth accumulation and estate planning to life insurance protection and retirement income.
The Hidden Gem in Financial Planning
With the LASER strategy in place, your IUL policy can typically grow tax-free, although it is possible to trigger a taxable event. For example, your IUL’s death benefit is income tax-free, but it is subject to estate tax. Nevertheless, the tax advantage of an IUL LASER Fund makes it an ideal option for supplementing retirement income or achieving your financial goals.
And your policy won’t lose money due to market volatility. It’s true—you could still lose money on a heavy down year because you’re still paying fees, but with the 0% floor, LASER Funds offer people peace of mind with greater market resilience. They protect you so that you don’t lose too much when the market drops and have the potential for growth when the market thrives.
Unlike traditional retirement accounts like 401(k)s or IRAs, which impose restrictions and penalties for early withdrawals, LASER Funds (using IUL policies) offer penalty-free, tax-free access to income via policy loans. Your cash value is both liquid and flexible, ready to meet your needs without disrupting your whole financial strategy.
Who Could Benefit Most from a LASER Fund?
A LASER Fund is perfect if you want to be your own banker with an IUL. That’s because it provides you with control over your savings and gives you access to funds in ways that traditional banking usually doesn’t.
They’re great for entrepreneurs or self-employed individuals seeking tax-efficient savings or even families planning for college or future significant expenses. From corporate leaders to business owners and everyone in between, anyone looking for flexible, growth-oriented retirement strategies should consider LASER Funds.
LASER Funds can enable you to self-finance more and not have to rely on traditional banks as much for your personal or business needs. If those are the words you’ve been hoping to hear, an IUL insurance policy may be worth looking into. It’s kind of like a tailored suit—it’s not one size fits all, but it’s worth it if it fits your financial goals.
Consult an Expert
Working with an IUL expert is crucial to customize the strategy to your family’s needs and financial situation. Plus, with a professional on your side, you have a greater chance of avoiding common mistakes that could risk your policy being set up incorrectly.
We’ll draw it out for you. Picture disastrous tax penalties that turn your tax-deferred growth into a barrage of IRS fees and surprises. Picture an eroding cash value as you miss premium payments repeatedly because of a mismanaged policy. It sounds like a financial nightmare.
Navigating a LASER Fund without an expert is like setting out on a road trip without a map—it’s possible, but why risk it?
Is a LASER Fund Right for You?
Ultimately, LASER Funds can offer numerous benefits, including tax advantages, safety, flexibility, and significant growth potential. This makes them powerful financial tools when used strategically.
But to fully harness their power, you must clearly understand all the intricacies and fees involved. Contact a professional who can walk you through the details you need to know and help you determine whether a LASER Fund (IUL insurance policy) is the right fit for you.