Your clients may be sitting on CDs, savings accounts, or money market funds that offer little more...
Tired of Low CD Yields? Here’s Why Single Pay Life Insurance Is a Smarter Alternative
Many clients nearing or in retirement are holding large amounts of cash in Certificates of Deposit (CDs). They value the safety and liquidity, but often complain about the low returns—especially after taxes and inflation erode their earnings.
As their advisor, you can show them a more efficient way to grow and preserve wealth: Single Premium Life Insurance (SPWL).
It’s a conservative strategy that delivers guaranteed growth, tax advantages, and wealth transfer benefits that CDs simply can’t match.
CDs vs. Single Premium Life: The Big Picture
| Feature | CDs | Single Premium Life |
|---|---|---|
| Principal Protection | ✅ Yes | ✅ Yes (with strong carriers) |
| Guaranteed Growth | ✅ Yes | ✅ Yes – with tax-deferred accumulation |
| Liquidity | ✅ Limited | ✅ Access to cash value (often in year 1) |
| Tax Treatment | ❌ Taxable annually | ✅ Tax-deferred growth |
| Death Benefit | ❌ None | ✅ Income tax-free death benefit |
| Estate Planning Benefits | ❌ No | ✅ Yes – efficient wealth transfer |
Why SPWL Works So Well for CD Clients
1. Tax-Advantaged Growth
CDs generate a 1099 each year—whether the client uses the interest or not. With single pay life, cash value grows tax-deferred, which means they keep more of what they earn.
2. Enhanced Legacy Value
A single premium purchase often results in a death benefit 2–3 times the premium amount, income tax-free to beneficiaries. Compare that to a CD, which simply transfers the account value (often taxable as income in an estate).
Example: A 70-year-old female invests $100,000 into a SPWL policy. She immediately creates a $200,000+ tax-free death benefit for her heirs, while maintaining access to cash values if needed.
3. Liquidity with Control
While CDs lock money away for a set term, SPWL provides access to cash value, often without penalty, if structured properly. Clients don’t have to wait until maturity to access their funds.
4. Long-Term Care Benefits
Some SPWL policies include living benefit riders that allow accelerated access to the death benefit in case of chronic or terminal illness—offering added peace of mind.
5. No Ongoing Payments or Market Risk
Just one lump sum, no future premium obligations, and no exposure to market volatility.
Ideal Clients for Single Premium Life
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CD and money market holders over age 60
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Retirees with idle cash they won’t need for daily expenses
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Those interested in leaving a legacy tax-efficiently
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Conservative savers frustrated by taxes and low returns
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Clients concerned about nursing home or long-term care needs
Bottom Line for Advisors
Your CD clients are craving safety, but they also want efficiency, tax advantages, and a better return on their money. Single Premium Life checks all those boxes—and adds a meaningful legacy benefit their heirs will thank them for.
It’s time to reframe the CD conversation.
Help your clients get more from their money—without taking on more risk.
Need help positioning SPWL in your next client meeting? I can provide custom illustrations, client-ready handouts, or conversation starters. Just say the word.
