Setting up your life insurance is one of the most helpful things you can do for your beneficiaries. Like other estate planning tools, life insurance works to keep your beneficiaries financially supported when you are, unfortunately, no longer around. Read on to discover how to utilize life insurance in your estate plan and how one of the seasoned Butler County elder law attorneys at Heritage Elder Law & Estate Planning, LLC can help you in doing so.
How do I incorporate my life insurance into my estate plan?
You may not initially realize this, but there are many expenses that your loved ones may incur upon your passing. However, your life insurance may help soften this blow. Examples of how you may incorporate your life insurance into your estate plan are as follows:
- You may plan for your life insurance death benefit to cover your final expenses (i.e., funeral expenses, outstanding debts. final income taxes, etc).
- You may plan for your life insurance death benefit to cover your beneficiaries’ daily expenses (i.e., educational needs, medical needs, personal needs, etc).
- You may plan for your life insurance death benefit to add to your beneficiaries’ overall inheritance total.
- You may plan for your life insurance death benefit to be tax-free and therefore can help cover any estate taxes or inheritance taxes.
- You may plan for your life insurance payout to equally split your assets that are difficult to divide (i.e., real estate, businesses, etc.) amongst your multiple piers.
- You may plan for your life insurance, in conjunction with a buy-sell agreement, to fairly compensate your beneficiaries for your share of a business.
What are the benefits of doing this?
Before all else, it is worth mentioning that it is best to establish your life insurance sooner rather than later. This is because your health risks are usually lower when you are younger; therefore, you may be able to opt for a cheaper policy.
That said, establishing your life insurance is essentially like establishing a contract with the insurance company. So upon your unfortunate passing, the insurance company may follow through on their duty in providing your beneficiaries with recurring payments or a lump-sum payment. Your beneficiaries may be able to start receiving this financial support within 14 to 60 days, so long as their claim is filed on time and correctly.
Overall, this is the best way to offer continual aid to your loved ones when you cannot physically do so yourself. At the end of the day, you must schedule an initial consultation with one of the competent Butler County estate planning attorneys as soon as you possibly can. Our team at Heritage Elder Law & Estate Planning, LLC will be awaiting your phone call.