It's important to understand first that all three plans can we used to save for retirement. People can utilize a 7702 Retirement Plan for exactly the same purpose as an IRA or 401(k). There are other similarities too, but there are some key differences. We've outlined the key points below. As always, do not hesitate to contact us if you have questions!
While IRAs and 401(k)s are common knowledge, we understand that the 7702 Life Insurance Retirement Plan is not as well known. Comparing the three plans is a great way to gather the basic knowledge you need as you determine whether the 7702 Retirement Plan may be a fit for you.
There are numerous similarities and differences between the traditional retirement plan options and the VestCred 7702 Retirement Plan, but there are 4 key features of our 7702 you cannot find in those other plans
no cap on contributions...
can be used for college savings too
borrow without penalty
zero losses in market downturns
Not everyone qualifies, but to see if you do costs absolutely nothing.
am I a candidate?
One of the key distinctions between these three plans is that the VesCred 7702 Retirement Plan has a floor underneath it. You're not going to lose principal or account value when the market plummets or should we enter a recession. The VestCred 7702 Retirement Plan is protected. By contrast, the IRA and 401(k) will lose value in the same way the market loses value. If the market is down 15%, your retirement savings could be down 15%.
The VestCred 7702 Retirement Plan can be structured so that it is entirely tax free for life. With an IRA and a 401(k), traditional plans are not tax free. Every dollar in the traditional IRA and 401(k) is taxed just like your wages during pre-retirement years. Roth IRAs and Roth 401(k)s are tax free in retirement, however.
When can I get retirement income without penalty?
59.5 years old
59.5 years old
Is my retirement income tax free?
Can I use it for my child's education?
Can I borrow money without penalty or restrictions?
Can I protect my retirement savings from losses during a down market?