By now, you understand that Variable Universal Life Insurance (VUL) is more than just a death benefit—it’s a financial asset you can use while you’re alive. But the real magic of VUL insurance happens when it’s used strategically across different life stages. Whether you’re in your 20s planning your future or in your 60s thinking about retirement and legacy, a variable universal life insurance policy can adapt to support your evolving financial goals.

In the United States, specially popular states like Florida, Texas, California, Illinois, and North Carolina, more families and professionals are learning how to use VUL as a living asset. In this article, we’ll walk through ways to get the most out of your variable life insurance policy—and how it can serve you differently at various stages of life.

In Your 20s and 30s: Build Wealth Early with Overfunding

When you’re young and healthy, VUL insurance is typically more affordable. This makes it the perfect time to consider **overfunding** your policy. That means paying more than the required premium to accelerate your cash value growth early. The sooner you start, the more time your funds have to benefit from compound interest and market-linked returns.

If you’re living in a growing city like Austin, Raleigh, or San Jose, this approach aligns with the financial habits of young professionals who want both protection and early investing options. The long-term result? A cash-rich policy that becomes more valuable over time—without you needing to take big risks in volatile markets.

In Your 40s and 50s: Tap into Your Policy for Real-Life Goals

This stage of life is where the flexibility of variable universal life insurance really shines. Perhaps you want to:

• Help your child pay for college
• Take a sabbatical or career break
• Renovate your home or invest in a second property

The cash value you’ve built over the years can now be accessed through tax-advantaged loans or withdrawals. Unlike other investment accounts, the gains in your policy grow tax-deferred. And since your coverage stays intact when structured properly, you’re still leaving a legacy while living your best life today.

In Your 60s and Beyond: Estate Planning and Guaranteed Legacy

As you approach retirement, you may start looking at how to transfer wealth or reduce your tax liability. A well-funded variable universal life insurance policy can be a key player here. Its death benefit is usually paid out **tax-free** to your beneficiaries, making it a powerful estate planning tool.

In states like Arizona, Virginia, and Ohio, many retirees use VUL for legacy planning—leaving a cushion for loved ones or even funding a charitable cause. Some even use it in conjunction with survivorship policies or trusts to maximize impact while minimizing taxes and fees.

What Is the Best Way to Fund Your Policy?

The best strategy depends on your income, risk tolerance, and goals. However, a general rule of thumb is to start with the intention of building long-term value. Consider regular premium payments that meet the minimum plus some overfunding. This ensures you’re covering the insurance charges and feeding the investment portion consistently.

Want an example? A 30-year-old investing $500/month could potentially accumulate hundreds of thousands in cash value by retirement, all while staying insured. Your own result will vary depending on investment choices, policy structure, and overall market performance—but the benefits of early, steady funding are clear.

Indexed vs. Variable: Understand the Difference

Sometimes people confuse indexed universal life with variable universal life. While both have cash value components, the difference lies in the investment style. Indexed policies track an index like the S&P 500 and offer a cap and floor on returns, which limits both risk and reward. Variable universal life insurance, on the other hand, offers greater freedom (and risk) by letting you choose from market-based sub-accounts—potentially yielding higher returns over time.

What About Surrender Charges?

Surrender charges are fees applied if you cancel or make large withdrawals early in the policy’s life. These can reduce your policy’s value if not planned properly. But don’t let this scare you—many policyholders never encounter significant surrender fees because they use the cash value strategically over time or wait until the charges phase out (typically after 10–15 years).

Combining VUL With Other Strategies

Variable universal life insurance doesn’t have to exist in a vacuum. Many financial advisors recommend using it alongside other strategies, such as:

• 401(k)s and IRAs for retirement planning
• Roth IRAs for tax-free income streams
• College savings plans (like 529s) for education funding

Think of VUL as your financial “Swiss Army knife”—versatile, powerful, and always useful in the right situation.

Is VUL Right for Multi-Generational Wealth?

Absolutely. A well-designed variable universal life policy can be used to pass on wealth efficiently to children or even grandchildren. By utilizing tools like private placement VUL or setting up a trust to own the policy, you can extend benefits across generations while minimizing estate taxes.

Think Long, Live Smart

VUL insurance isn’t just another financial product—it’s a financial lifestyle. It offers protection, flexibility, investment opportunity, and real-world utility. Whether you’re starting out, building wealth, or preparing to pass it on, a well-structured variable universal life insurance policy can meet you where you are—and grow with you.

Now that you’ve seen how VUL works in the real world—from overfunding in your 20s to legacy planning in your 60s—it’s time to look at your own goals. Speak with a licensed advisor. Request a customized quote. Explore how this tool can shape your financial future in ways traditional policies simply can’t.