Taking Care of Employees Without Impacting the Bottom Line

A major issue facing businesses and municipalities of all sizes in this uncertain economy is significant shortfalls in their offered benefit programs. These entities have many loyal and talented employees that deserve to be thanked. But however deserving these people might be, funding nonqualified benefit plans, post-retirement benefits, or buyout packages is expensive. Most of these organizations don’t have the cash immediately available, nor do they want to divert resources from critical other activities. But with CashStream®, life insurance can be used to create significant additional cash flow (without the need for deaths), thereby eliminating the need to alter benefit programs.

How It Works

With CashStream, benefit programs can be funded with leveraged money. Businesses can provide life insurance policies to their employees, then use the cash value of the policies combined with other assets (if necessary) to collateralize a loan in order to fund the premiums instead of paying out-of-pocket. With CashStream, interest is typically but not always rolled up into the loan and an insurance product is used that has the opportunity to grow cash values that outperform the loan.

When the cash value is sufficient, the loan is paid off and CashStream’s purpose is realized: not only are the company’s life insurance policies fully funded, but the excess cash values can be used to informally fund programs such as buyouts or post-retirement benefits.