Life insurance can be used as an investment tool for retirement planning in several ways. One common method is to purchase a permanent life insurance policy, such as whole life or universal life, which builds cash value over time. This cash value can be invested and grow tax-deferred, and it can also be used to supplement retirement income.

Another method is to use a cash value policy as collateral for a loan in order to invest in other assets such as real estate or stocks. The interest on the loan is generally lower than what you would pay on a traditional loan and the cash value of the policy is used as collateral so the investment is less risky.

Another strategy is to use variable life insurance, where the cash value of the policy is invested into various sub-accounts, such as stocks and bonds. The performance of these sub-accounts will determine the cash value of the policy, and thus the potential retirement income.

It's important to note that life insurance policies have different features and riders, and the best strategy for retirement planning using life insurance will depend on your individual needs and goals. It's always good to consult a financial advisor or insurance professional for personalized advice.