He noted that life insurance can provide a source of tax-free income in retirement, which can help clients delay taking Social Security and/or not having to sell appreciated assets.
“Using life insurance for income-tax planning is crucial right now and we need to pivot from using life insurance as an estate vehicle to an income vehicle," Friedman said. "Same thing with annuities with their ability to provide a tax deferral, along with lifetime income and the ability to avoid volatility.”
November Election
As for the November election, Friedman offered his three cents that he expects the Republicans to keep control of the U.S. House of Representatives regardless of the outcome of the presidential race.
“Republicans will keep the House of Representatives, not just in 2016 but for the rest of the decade” he predicted. “And if they continue to control the state governments––they hold 31 currently––they’ll probably control the House for the next decade as well when we have redistricting in 2020.”
The U.S. Senate could be a different story. “I believe whoever wins the White House is likely to control the Senate,” he said.
Regarding the presidential race, Friedman predicts that Clinton will face Trump in the general election, but that you can't rule out Cruz if there’s a contested GOP political convention this summer.
All three candidates have very poor favorability ratings, but Clinton’s rating is better on a relative basis. In addition, he noted, several factors seem to be favoring the Democrats.
For starters, the candidate who can attract minority and women voters will probably do better in the election. “If the Republican candidate stays at [getting] 17 percent of the non-white votes (what GOP candidate Mitt Romney got in 2012 and what Republicans have roughly been getting in recent years], he will need 65 percent of the white vote to win the election. That was approached just once, by Ronald Reagan in his second term,” Friedman said.
Another big factor will be how independent voters will swing in November. According to Friedman, this year marks the highest percentage of independent voters during a presidential election year––42 percent versus 40 percent in 2012. He posited that independent voters by and large are more concerned with economic issues, jobs, taxes and fiscal matters, and they don’t like the dogmatism and partisanship they see in Washington.