When you're building your portfolio, you may not think about adding a life insurance policy. But it's not too late. Life insurance can be a valuable addition with many benefits, including:
- Liquidity of the death benefit. Since your death benefit will be paid in cash when you pass away, it’s a liquid asset that can be accessed quickly by your beneficiaries.
- Easy distribution. Assets can be split among any number of heirs.
- Predictable value. Since some types of life insurance earn cash value on a predetermined schedule, you can predict the value of your policy at a future date.
- Stability. When life insurance is guaranteed, the value of the death benefit isn’t affected by the economy or changes in the stock market.
- Tax advantages. Cash values in a life insurance policy grow tax-deferred. Beneficiaries receive your death benefit income tax free. And estate tax free, too, if properly structured.
Is life insurance considered an asset? Find out by talking to your insurance professional about adding life insurance to your financial portfolio.