Life Insurance Consultant
Effective January 1, 2026, clients will be able to take money out of qualified retirement plans prior to age 59 ½ and use that distribution to pay for LTC premiums – without incurring a 10% penalty.
A few notes:
- Withdrawals are limited to the lesser of $2,500 or 10% of the client’s vested balance
- Funds must be used on a 7702B qualified LTC contract
This could be a way to motivate younger clients to “get ahead” and pay for LTC coverage prior to 59 ½ when premiums are lower and they have all product options at their disposal.
Contact Wholehan Marketing for guidance on policies that count as 7702-B qualified and let us help you open the door for more LTC conversations with your clients!