Your 401(k) grows tax-deferred. Your IRA has limits. Your Social Security is fixed. Our SHIELD Fund Strategy fills the gaps — building tax-free retirement income with market-linked growth, a guaranteed 0% floor, no contribution limits, and a permanent death benefit. All in one policy.
An IUL is a permanent life insurance policy with a cash value component that grows based on a market index — without being directly invested in the market. Here's exactly how the growth and income mechanics work.
You pay a premium. The insurer deducts the cost of insurance and administrative fees. The remaining amount — your net premium — is allocated to an index account or fixed account of your choosing.
At each policy anniversary, the insurer measures how much your chosen index (typically the S&P 500) moved during the year. Your cash value is credited a portion of that gain — up to a cap rate — using your policy's participation rate or multiplier structure.
If the index drops — even dramatically — your credited interest for that year is 0%, not negative. Your previously accumulated cash value is locked in and never at risk from market losses. This is the defining feature that separates an IUL from variable products.
When you're ready to draw income, you take policy loans against your cash value — not withdrawals. These loans are not taxable income. Done correctly, they are never repaid during your lifetime and are offset against the death benefit at death. The result: a stream of tax-free retirement income.
The key distinction: IUL income is received as a policy loan — not a distribution. This means it doesn't appear on your tax return, doesn't increase your adjusted gross income, doesn't trigger IRMAA Medicare surcharges, and doesn't make more of your Social Security taxable. It's genuinely tax-free income when structured correctly.
The SHIELD Fund is not a product you buy — it's a six-principle framework for evaluating and building a retirement income strategy that solves the problems your 401(k) was never designed to address. When the goal is maximizing retirement income, every IUL we build at MFS is structured around this framework — not simply to provide life insurance coverage.
A guaranteed 0% floor means your balance holds when markets fall. You don't lose ground in bad years — you simply earn nothing, and start the next year from the same protected base. Your gains are locked in permanently at each policy anniversary.
The policy is structured to maximize cash value — not death benefit. By setting the death benefit at the IRS minimum and pushing premiums to the TAMRA limit, more of every dollar works toward retirement accumulation rather than insurance overhead.
Retirement income is accessed through policy loans — structured debt, not taxable income under current federal law. It doesn't appear on your tax return, doesn't increase MAGI, doesn't trigger IRMAA surcharges, and doesn't cause more of your Social Security to become taxable.
Your cash value is indexed to market performance — not invested directly in it. When the S&P 500 rises, you earn a credited percentage up to a cap. When it falls, you earn 0%. You participate in economic growth while remaining fully insulated from market downturns.
No age restrictions. No early withdrawal penalties. No government-mandated timetable. Access your cash value when you need it — for a business opportunity, a family emergency, or supplemental income well before traditional retirement age. Your money is not locked behind an age gate.
A meaningful, income-tax-free legacy passes to your family automatically — no probate, no income tax owed by heirs, no additional planning required. Any remaining cash value at death is amplified by the death benefit and transferred directly to your beneficiaries.
A standard IUL sold primarily for death benefit is a fundamentally different instrument from a SHIELD Fund strategy. The intent, the funding structure, and the outcome are entirely different. Here's what sets this approach apart.
Premiums are pushed to the IRS maximum (TAMRA limit) and the death benefit is set at the required minimum — directing the maximum possible dollars into cash value rather than insurance overhead.
We're not captive to any single company. We shop Athene, Allianz, North American, Midland National, Corebridge, and other A-rated carriers to find the product with the best cap rates and renewal history for your specific profile.
As an RSSA®-credentialed advisor, Hayden layers the SHIELD Fund alongside your Social Security strategy, annuity income, and IRA drawdown plan — building a coordinated income picture that minimizes taxes and maximizes lifetime income.
We show multiple crediting scenarios including rates well below historical averages. We review each carrier's cap rate history before recommending any product. You see the realistic picture — never just the best case.
Hypothetical illustration for educational purposes only. Assumes $24,000/year, 15-year accumulation, 6.5% illustrated rate, conservative assumptions. Not a guarantee of future results. Actual results depend on carrier, health class, and index performance.
The concepts behind the SHIELD Fund draw from the foundational work of financial strategist Doug Andrew — specifically the principles developed in The Last Chance Millionaire — applied through Hayden's independent broker platform and RSSA® retirement income planning framework.
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IUL has become the fastest-growing permanent life product in the country. Here's why the data supports considering it as a retirement income vehicle.
Important context: IUL does not directly invest in the market. The S&P 500 price index (excluding dividends) has returned approximately 7.2% annualized historically — not the commonly cited 10.4% total return figure. Cap rates are also non-guaranteed and can be reduced by the carrier at renewal. These are real variables that a properly structured illustration will account for. We always present conservative and realistic projections — never just the best-case scenario.
The power of an IUL as a retirement asset is time. A properly structured policy funded consistently over 20–30 years can accumulate substantial tax-free income — here's a hypothetical illustration.
The chart below illustrates hypothetical cash value growth for a 40-year-old contributing $1,000/month ($12,000/year) into a properly structured IUL policy at a conservative 6% illustrated rate — the regulatory standard used by most carriers for illustration purposes.
* Hypothetical illustration only. Assumes $1,000/month premium, age 40, 6% illustrated rate, male non-smoker, properly structured to avoid MEC. Actual results depend on carrier, policy design, health class, and index performance. Not a guarantee.
The income phase: At age 70 with ~$520,000 in cash value, a properly structured policy can generate approximately $25,000–$40,000 per year in tax-free policy loan income — without depleting the death benefit entirely, depending on interest crediting and loan rates.
IUL is most commonly compared to a Roth IRA — both offer tax-free income in retirement. Here's how they stack up across the features that matter most for retirement income planning.
| Feature | IUL | Roth IRA | Traditional 401(k) |
|---|---|---|---|
| Tax-free income in retirement | ✓ Yes (policy loans) | ✓ Yes (qualified distributions) | ✗ Fully taxable |
| Annual contribution limit | None (subject to MEC) | $7,000 / yr ($8,000 age 50+) | $23,500 / yr (2025) |
| Income limit to contribute | None | Yes — phases out at $161K+ | None |
| Required Minimum Distributions | ✗ None | ✗ None | ✓ Starting age 73 |
| Principal protection from market | ✓ 0% floor | ✗ Market risk | ✗ Market risk |
| Affects IRMAA / SS taxation | ✗ No | ✗ No | ✓ Yes — increases MAGI |
| Permanent death benefit | ✓ Always included | ✗ No | ✗ No |
| Living benefit riders | ✓ Available | ✗ No | ✗ No |
| Growth mechanism | Index-linked (capped, floored) | Market investments (uncapped) | Market investments (uncapped) |
| Employer match available | ✗ No | ✗ No | ✓ If offered |
| Probate / estate transfer | ✓ Bypassed, tax-free | Bypassed (named beneficiary) | Bypassed (named beneficiary) |
An IUL is not the right tool for every situation. But for the right person, in the right window, it can fill retirement income gaps that no other product addresses. Here's who benefits most.
We don't recommend IUL to everyone — and we won't recommend it to you unless it genuinely fits. Here's when it doesn't make sense.
You haven't maximized your employer 401(k) match. Always capture free matching dollars first — no IUL will outperform a 100% immediate return on investment.
You need full liquidity in the near term. IUL has surrender charges in the early years and is designed as a 15–30 year vehicle. If you may need the money within 10 years, it's the wrong tool.
You can't commit to consistent premium payments. An underfunded IUL underperforms significantly. The cost of insurance eats into cash value if premiums aren't consistent — proper structuring requires steady funding.
You want uncapped market returns. An IUL caps your gains in exchange for floor protection. If you want maximum market upside and can tolerate full market risk, a Roth IRA invested in index funds may outperform over a long bull market.
You're looking for a short-term solution. Policies surrendered within the first 10 years frequently generate negative net returns after surrender charges and accumulated cost of insurance deductions. This is a long-term commitment.
Not all IUL policies are created equal — and not all advisors structure them the same way. Here's what sets our approach apart.
We structure IUL policies to maximize cash value accumulation — keeping the death benefit at the IRS minimum to reduce insurance costs and put more of your premium to work in the cash value.
We're independent. We shop Athene, Allianz, North American, Midland National, Corebridge, and other top-rated carriers to find the policy with the best cap rates, participation rates, and renewal history for your situation.
We don't sell IUL in isolation. We layer it alongside your Social Security strategy, annuity income, and IRA drawdown plan to build a coordinated retirement income picture that minimizes taxes and maximizes lifetime income.
Every IUL illustration is custom-built around your age, health class, income, goals, and time horizon. Schedule a free consultation with Hayden McCrory and get a personalized, no-obligation illustration showing what your policy could accumulate over 10, 20, and 30 years — including projected tax-free income in retirement.
