When it comes to wealth objectives, investing in life insurance is considerably attractive. For a subscriber, life insurance meets a variety of needs, including: investment of savings, transmission of wealth, constitution of a retirement supplement, etc. This article aims to develop a little more these various reasons for subscribing to this type of contract.
Life insurance: savings investment
In life insurance, various options are available. Depending on what one chooses, it offers the possibility of:
- Generate profit with a capital in complete safety;
- Realize savings that can be recovered at any time;
- Benefit from an additional income
- Investing in the stock market
There are two types of contract, namely: single-support life insurance and multi-support life insurance. In both cases, the invested funds can always be recovered at any time. The difference between these contracts is the investment strategy you wish to pursue.
Preparing for retirement with life insurance
Investing in life insurance allows the policyholder to prepare well for retirement. The investment can be funded according to his pace, i.e., according to his savings capacity. And, of course, the savings can be recovered. At the time of his retirement, an improvement in income will be noticed if the policyholder has taken out a life insurance policy early enough. He will have the choice between making partial withdrawals and making regular withdrawals (subject to the progressive income tax scale for savings withdrawn in capital). There is also what is known as a life annuity withdrawal (income tax-exempt gains), which must be provided for in the initial contract.
Passing on an estate
With life insurance, you have an instrument for planning your estate. You no longer have to worry about the civil and tax rules related to the estate since life insurance is not included. The transmission of assets to a loved one becomes easy because you no longer have to deal with inheritance tax. However, the premiums must not be too exaggerated. Also, if the deceased has children, a portion of the estate is obligatorily intended for them. It depends on the number of children:
- Half for one child;
- 2/3 for two children;
- The ¾ for 3 children or more.
It should be noted that the life insurance death benefit is not fully tax-free. The taxation of the life insurance contract will depend on the date of subscription and the age of the policyholder at the time of payment of the premiums.