If you are like many investors who are trying to build a brighter financial future for your family, you probably sock away as much money as possible into your retirement account, purchase stocks and bonds, and maybe even own real estate.
But there is another option out there for you and your family, one that presents much less risk and delivers guaranteed pay offs: investing in life settlements.
Life settlement investing involves funds that purchase life insurance policies from people who can no longer afford them or no longer need them. It is a way to truly diversify your portfolio with investments that are not subject to the roller coaster that is the stock market, real estate ups and downs, global politics or natural disaster.
Here is a look at five reasons why investing in life insurance settlements makes sense for you and your family:
1. Life settlement investments are incredibly low-risk.
Once you have invested in a life settlement fund (or purchased one yourself), the primary risk is time. Because you receive the death benefit, you pay the premium as long as the policy is active.
A plunging stock market, geo-political upheaval, adverse legislation and natural disasters do not cause your investment to lose money.
2. Life settlement investments typically outperform the stock market.
According to some analysts, life settlement investments regularly outperform the S&P, consistently delivering returns ranging from the high single digits to the low double digits. One study conducted by the London Business School found that purchasers of life settlements earned annual rates of return of 12.5 percent from 2001 to 2011. Between 2005 and 2007, the rate was as much as 18.3 percent.
Being able to count on guaranteed returns allows you more flexibility to leverage your assets through other investments--and perhaps even allocate your higher risk capital elsewhere--while you wait for the policy to pay out.
3. There are no ongoing fees with life settlement investments.
Once you have made the decision to invest in life settlements, a broker can help you find a fund in which to put your money or identify opportunities for you to purchase life insurance policies outright. After the sale is finalized, you do not incur any ongoing management fees.
The lack of fees allows you to have more money to invest elsewhere, thus further diversifying your portfolio.
4. You'll be in good company when you invest in life settlements.
Many people don't consider life settlement investments because they either aren't aware of them or don't think they have the backing of major financial institutions. In reality, though, investors include many of the major financial institutions including banks, international hedge funds and mutual funds.
When you invest in life settlements, you are in good company.
5. Life settlement investments provide win-win opportunities.
It has been said that the best deals are those in which both parties walk away dissatisfied. Nothing could be further from the truth when it comes to life settlement investments, which actually are win-win opportunities.
The seller of the life insurance policy typically receives a significant amount of money that can be used for medical expenses, retirement or long-term care, and the buyer gets the guarantee of a significant return. Life settlements are investments that everyone can truly feel good about.
Learn More About Life Settlement Investments
If you're ready to diversify your portfolio and know with certainty that you have taken the steps to build a brighter financial future for your family, let us show you how life settlements are an option everyone can appreciate.
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