IUL vs. 401(k): Which One’s Built for the Future?
They're both retirement tools — but one gives you tax-free access, no penalties, and protection from market crashes. Let's break it down.
IUL vs. 401(k): Side-by-Side Comparison
They're both retirement tools — but one gives you tax-free access, no penalties, and protection from market crashes. Let's break it down.
| Feature | Indexed Universal Life (IUL) | 401(k) |
|---|---|---|
| Tax-Free Retirement Income | ✅ Yes (via loans) | ❌ No (taxed at withdrawal) |
| Early Access Without Penalty | ✅ Yes (no age restrictions) | ❌ No (penalty before 59½) |
| Downside Protection | ✅ Yes (0% floor) | ❌ No (subject to crashes) |
| Required Distributions | ❌ None | ✅ Yes (starts at age 73) |
| Affects Financial Aid | ❌ No | ✅ Yes |
| Creditor Protection | ✅ Often Yes | ❌ Usually Limited |
| Contribution Flexibility | ✅ Flexible | ❌ Rigid & capped annually |
| Loan Access | ✅ Yes, tax-free | ❌ No |
| Tax on Growth | ✅ Tax-deferred to tax-free | ✅ Tax-deferred only |
Why Most People Never Hear About This
Simple: most retirement plans are built by Wall Street. IULs are built by mutual insurance companies that don’t advertise on CNBC.
401(k)s were designed for employers. IULs are built for individuals who want:
- More control
- More protection
- More legacy
If you’re someone who wants a customized, tax-advantaged retirement strategy that adapts with you, an IUL might be the tool you’ve been missing.
Wondering if an IUL is right for you?
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