Tags: Dividend stock, Invest money, Cash value, Whole life insurance, Shares

Whole Life Insurance vs Best Dividend Stock

August 4th 2020

Whole life insurance vs Dividend Stocks

 

Numerous whole life insurance policies provide dividends representing a part of the insurance company earnings that are paid to policyholders. In many ways, these dividends are like customary venture dividends that represent a share of a public organization's profit. However, the best insurance companies tend to be private, thus not publicly traded.

 

What is Whole Life Insurance?

  • Whole life insurance goes on for a policyholder’s lifetime, rather than to term life insurance, which is for a particular amount of years.
  • Whole life insurance is paid out to a recipient or beneficiaries upon the policyholder’s passing, provided that the premium payments were kept up.
  • Whole life insurance pays death advantages but also has reserve funds components in which money can build up.
  • The saving segment can be invested, also, the policyholder can get the money while alive, by either withdrawing or borrowing against it, when needed.
  • Rates are locked in on whole life policies. This is not to be confused with term or universal life insurance where rates fluctuate or become so expensive you can’t keep the policy. Traditional whole life insurance is recommended for those who can afford it for this reason.
  • Whole life insurance pays a death benefit but also has reserve funds components in which money can build up.
  • The saving segment can be invested but by the insurance company and they are able to offer it to clients as cash value, not subject to market downturns; also, the policyholder can get the money while alive, by either withdrawing or borrowing against it, when needed.

What is dividend stock?

 

This is another popular product and is not whole life insurance. You have probably considered buying dividend stocks as well. Here’s more important information on dividend stocks.

A dividend stock is a dividend payment to investors that is made in shares as opposed to money. The stock dividend has the benefit of compensating shareholders without reducing the company's cash balance, although it can dilute income per share.

  • Stock dividend is a profit paid to shareholders in the form of extra shares in the company, instead of as money.
  • The best dividend stock is not taxed until the shares granted are sold by their proprietor.
  • Like stock parts, stock dividends dilute the share cost, however as with cash dividends, they do not influence the value of the organization.

Find Best Dividend Stocks

The Renowned  Boracchia Wiviott Wealth Partners is also excited to offer innovative do it yourself investment portfolios in addition to custom financial plans and masterclasses.

 

Investing profits pros provides the holdings to buy and the recommended

asset allocation for each asset class.

Start your Custom Asset Allocation portfolio TODAY with the award winning team Boracchia Wiviott Wealth Partners!

Best dividend stock

Nothing is a best dividend stock according to all financial specialists. One interesting idea is a "scrip dividend," a stock dividend is a distribution of shares to existing investors of a cash dividend. This kind of dividend may be made when a company needs to reward its shareholders but doesn't have the extra money or needs to preserve its cash for other ventures.

 

Stock dividends have a tax advantage for investors. They offer a dividend, similar to any stock share, that is not taxed until the investor sells it except the company offers the choice of accepting the dividend as money or in stock.

 

A dividend stock may require that the newly received shares are not to be sold for a specific time-frame. This holding period on a stock dividend regularly starts the day after it is bought. Understanding holding time-frame is significant for deciding qualified dividend tax treatment.

Whole Life Insurance vs Best Dividend stock

How do whole life dividends from a life insurance company differ from other stock dividends?

 

The word “dividend” creates confusion because it is frequently used about a public company paying a stock dividend. If you own stock in a public organization that pays dividends, you may get a quarterly check from the company. A stock company may likewise pay stock dividends, which come in the form of extra shares instead of money. Dividends represent corporate income and are controlled by a company’s board of directors.

 

Life insurance dividends likewise represent earnings. However, mutual life coverage companies, by law, must impart all benefits of the company with participating policyholders. Benefits well-beyond monies set aside for legacy benefits and working costs are distributed back to policyholders as dividends. In contrast, the goal of a stock insurance company is to make a profit for its shareholders or investors.

 

If stock dividends are paid and reinvested into the policy as paid-up additions, they become part of the guaranteed cash value and part of another, a higher floor that builds future gains—both ensured additions and dividend payouts. The cash worth can never lose value and is ensured to develop by at least a minimum guarantee.

 

Contrast this to a stock dividend. Many people re-invest their stock dividends. If the cost of the stock goes down after that reinvestment, you have basically “lost” your profit. So you should sit tight for the price of the stock to return up to “recoup” your dividend.

Getting a whole life insurance policy as an investment

 

Whole life permits the policyholder to accumulate wealth and utilize these reserve funds during their life, as far as investments go, whole life insurance is not an investments.

 

Depending on market performance and your situation, you may consider buying long-term life insurance with a fixed annual rate and working with an investment counselor to figure out the best strategy for how you invest your money.

 

Whole life insurance is one of many tools that can achieve what nothing else can, and should be taken out with a registered independent advisory with no brokerage ties.

 

Building and protecting wealth with whole life insurance

The rate of return on a whole life insurance policy is very low as compared to other investments, even with the tax savings considered in. Life insurance should not be utilized exclusively as an investment tool and you should judge your policy decisions on the protection and not just the rate of return.

 

Typically the best financial plans include a portion of whole life insurance for your long term safe dollars and heirs, as well as dividend income stocks to reinvest in and help supplement retirement.

 

In a down market, you can consider your guaranteed money as a place to access money no problem. In an up market this is ideally when you are pulling from your best dividend income stocks.

 

Remember tax loss harvesting can help you to earn higher returns on your stocks.


Read more about tax planning for a comfortable life after retirement.

Share this post on:

Lea Wiviott Boracchia, Co-Founder, FinancialPlans.Info and InvestingProfits.Pro, both apart of the renowned Boracchia Wiviott Wealth Partners

We are a registered investment advisory focused on accessible wealth planning for everyone. Our mission is to help women, men and people of all ages, races, locations, and anyone plan and secure their most successful future. We were originally established in 2005 by way of 3 firms before my husband Marc and I registered our independent advisory in California.

RELATED BLOG POSTS

  • Retirement Tax Planning

    Tax Planning:

    Optimize your savings for Retirement

    03 August  2020

  • Financial Planner and Advisor

    How Does Long-Term Care Insurance Works?

    21 October  2020

  • Financial Plan!

    Why is Having a Financial Plan Important?

    30 July 2020

  • Make money online by easy ways!!

    Earn Free Money by Frugal living

    10 November 2018

CATEGORY

SUBSCRIBE

FEATURED ARTICLE


Stay focused on your goals with Boracchia Wiviott Wealth Partners through our 

eBooks, financial planning, newsletter subscription services, segment expertise, private wealth management, fee based planning, and industry leadership!

This site is protected by U.S. and International Copyright Laws. It can be used only as agreed with the Terms of Use, and any replicating, copying or redistribution entirely or partially, is prohibited without the strict consent of Boracchia Wiviott Wealth Partners, LLC. 12655 W Jefferson Blvd 4th Fl, Los Angeles, CA 90066. 

Copyright © 2020 by Boracchia Wiviott Wealth Partners.  All Rights Reserved.

Past performance is not a predictor of future results. Individual investment results may vary. All investing involves risk of loss. Due to the robust nature of the internet, we cannot be responsible for any information provided, you must verify the accuracy and feasibility of it all. For our full list of policies you agree to in using our site please click on policies.


Investment Portfolio Subscriptions, Classes & Resources

Commodities & Material Investing Stock Market Portfolio  

 

Communication Services, Consumer Discretionary, & Marijuana Investing Stock Market Portfolio  

 

Consumer Staple, Real Estate, & Utilities Investing Stock Market Portfolio   

 

Energy, Financial, & Industrial Investing Stock Market Portfolio

 

ETF Stock Investment Portfolio to Buy

 

Fixed Income Investment Bond Portfolio

 

Forex and Currency Investment


Global Developed & Emerging Investing Stock Market Portfolio

 

Gold and Silver Portfolio of these Best Stocks to Buy Right Now

 

Healthcare, Biotechnology, & Pharmaceutical Portfolio of Best Stocks to Buy Today

 

Software, Information Technology & Semiconductor Investing Stock Market Portfolio

 

Investing Profits Pros, Unique Do It Yourself Investment Ideas for Everyone!

 

All Wealth, Stock Market & Real Estate Master Classes 


Risk Management, Annuities & Insurance Ideas including Whole Life Insurance

 

Residential & Commercial Real Estate Agent Expertise

 

Fee - Based Private Wealth Management for Individuals, Families and Businesses

 

Start Your Custom Financial Plan Today!

 

How to Save Money for Retirement Planning, Compute the Proper Retirement Age & More BLOG - Financial Plans Information 

 

The Best Stocks to Buy Right Now in the Stock Market & Cryptocurrency BLOG - Investing ProfitsPros

 

Work at Home Jobs for Moms, How to Make Money Online & Investing in Real Estate BLOG - My Best Lifestyle Experts

 

Growth Mindset & More on the Stock Market & How to Make Money Online BLOG - Success Striver

 

Qualified Tax Planning

 

Investments, Wealth and Financial Planning Resources 

 

 

 

About

Lifestyle Experts and Financial Planners, $1mil + by 30, Trailblazer of Minorities & Women in Real Estate & Investing in the Stock Market. Mompreneur. Dadpreneur. Private wealth meets your favorite motivational speaker with actionable items you can make money online from efficiently! I look forward to connecting with more badass women and men, ;) to your your best life with us as your leaders to which are the best stocks to buy right now, Lea, Marc & Team

 

Customer Service Center

Contact Your Boracchia Wiviott Wealth Partners

M – F | 9 AM – 5 PM PST

Team@MyBestLifestyle.Pro

 

Within the United States: (424) 625 - 8943                

                                              

If you are outside of the U.S. please dial +001 (424) 625 - 8943  



Policies

Terms of Use

 

Accessibility Policy

 

Disclosure Policy

 

Privacy Policy

 

Affiliate Program - We have one,  it is run through Kartra! Please join others in helping build wealth for you & your community. If it's easier, please email Team@MyBestLifestyle.Pro and we'll send you the link, we look forward to hearing from you! Thanks!

Boracchia Wiviott Wealth Partners LLC, your best Financial Advisors!!