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Case Study

Our client was a 72-year-old retired business owner who had approximately $600,000 in a traditional IRA. Because of his age, he was being forced to take his required minimum distribution, which was a little over $23,000 per year. After some fact-finding, we determined that they did not need the distribution for living expenses and were depositing the distribution into a money market account each year, with no real goal in mind. 


Once we determined that the client was never going to need the money and ultimately wanted to leave a legacy to his church, I proposed the following plan...


We calculated that his $23,000 distribution, after taxes, would fund a $900,000 second-to-die policy. One concern that I brought up was the fact that the IRA was currently being funded with a money market account earning less than 1% which created longevity risk since his required distribution was over 3%. In order to take that risk off of the table, we proposed taking the IRA and transferring to an immediate annuity, which would fund the life policy no matter how long the client lived.


We named the church as the owner and beneficiary of the policy. For our client, he was able to turn a $600,000 taxable benefit into a $900,000 tax-free benefit and leave his church a legacy that he never dreamed was possible.


This is just one example of how I can work together with you to help you reach your goals and help your clients leave a legacy to someone or something they love.

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