SEP IRA plans can be compared to all kinds of different retirement plans. Most commonly you will see the SEP IRA vs 401k or sep IRA vs roth ira. But their is another comparison that should be explored. And that is comparing the SEP ira to indexed universal life insurance.
Interested in a comparison?
go here: leveragedwm.com/iul-review
The sep ira is a great retirement plan for small business owners that have few to no employees looking for high deferral limits.
SEP IRA pros and cons:
high deferral limits – pro
relatively inexpensive – pro
tax deferred-pro
must contribute for employees – con
taxed upon withdrawal- con
subject to 59 1/2 rule – con
subject to market risk – con
When comparing the SEP IRA vs Indexed universal life insurance for retirement income, the indexed universal life policy generates tax free income and is not subject to market risk. more importantly you are allowed to pick and choose which employees participate in the indexed universal life policy and which ones do not.
If your goal is maximum tax free retirement money achieved using safe money investments, the IUL smokes the SEP IRA. Especially if you have multiple employees.
Interested in a comparison?
go here: leveragedwm.com/iul-review
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Now if I'm corrected the employer can setup the IUL where his business pays for the premium where it counts as a expense which is a tax deduction. This allows you to use $55k instead of $38k after tax dollars.