Have you heard of “770” accounts? For a while there, they were a hot topic of conversation on the internet. A lot of people hadn’t heard of them before, and once they learned of their existence, they were off creating them for the first time. As often happens, though, the internet soon lost interest and was on to promoting something else. That doesn’t mean that 770s aren’t still vital and smart investment options. They are, and they are something that just about everyone should be taking advantage of.
In case you missed their last wave of popularity, 770 accounts are special accounts named for the 770 section of the tax code, which discusses how to cover funds that exist within a life insurance policy. Unbeknownst to a lot of people, these policies are a great way to grow and save money. You can use either term or whole life insurance policies for this purpose, though term is sometimes cheaper during the first few years of ownership. Whole, on the other hand, tends to grow larger amounts of cash than term. Regardless of which type of policy you hold, however, as long as it’s a well-done, soundly created policy, it can bring you many awesome investment benefits, which include:
l Cash value that is never reduced, providing premiums are paid
l Guaranteed growth every year
l Tax deferred growth and dividends
l Ability to access funds without paying taxes or penalties
l No loan repayment restrictions
l Cash value can increase on borrowed funds
l Cash value can be used for any purpose
l Can hold large amounts of money
l Self-completion option
l Ability to leave behind a sizable, tax-free benefit for friends and loved ones
While any life insurance policy can be built in such a way so that it pays off nicely in the end or even in the present, 770s are specially designed to be a good, sound investment almost as soon as they’re established. If you want your policy to be an investment, you need to have it set up correctly. Get professional help and let your financial or insurance advisor know what your goals are for setting up the policy. That way, you can have a policy that does everything you were hoping for when you opened it.