If you want to make sure that your children and other loved ones are well cared for when you are gone, you need to take estate planning seriously. Having a plan in place can ensure that your assets go to the right beneficiaries and that the entire inheritance process is less stressful for everyone involved. While you are planning your estate, you should also be thinking about your life insurance. There are actually a few smart ways to use your life insurance as a part of your estate plan. If you want to learn more, a Monmouth County estate planning attorney from our firm can help you weigh your options.
What Types of Life Insurance Can Be Used in Estate Planning?
There are two types of life insurance that can usually be fit into an estate plan. We can find good uses for:
Term life insurance: This pays out a death benefit if you pass away during a certain term, or period of time. Policies usually last between 10 and 30 years. This can be a good option for someone who believes that their estate will have enough money to cover their final expenses whether or not there is a policy to collect.
Universal or whole life insurance: This policy lasts until you pass away, so you can be sure that there will be some kind of payout at the end of your life.
How Can I Use My Insurance Policy In Estate Planning?
Either type of policy can be used in a few different ways. Some common ways to make the most of these policies include:
Paying final expenses: Everything seems to be more expensive these days, and somehow that even applies to death. Final expenses like funeral costs, income taxes, and any debts that you left behind can all be paid for with your insurance benefit. This can free your family of a rather large financial burden.
Equalizing an estate: A life insurance benefit can be used to help equalize how much of your estate can be left to your heirs. This can be a good option when you have a hard time splitting what you own evenly between multiple beneficiaries.
Funding ongoing expenses: Sometimes you can use life insurance to continue funding daily expenses for a loved one. This can be a good option if you have an aging family member or a loved one with special needs. There are also some other options to discuss with our estate planning lawyers if you want to continue to provide for someone’s care after you are gone.
Paying estate taxes: Instead of having your family pay estate taxes, you can plan things so that your life insurance benefit is used to pay this expense.
Talk to Our Estate Planning Lawyers
When you are ready to make the most out of your life insurance plan, contact the Law Offices of George J, Mardinly. Our lawyers have more than two decades of experience helping people build their own comprehensive estate plans, and we are ready to help you too.