Financial Planning is a process that provides a client with impartial assistance in analyzing and organizing personal financial affairs in order to achieve financial and lifestyle goals in a tax effective manner. Estate Planning is Financial Planning – starting with the end in mind. The principal objective of estate planning is to ensure that your property is managed most efficiently during your lifetime and that your wishes are carried out most effectively after you die.
Life insurance can be used in numerous ways to help you achieve your estate planning objectives. In fact, there are too many to be completely covered here, so I will provide a few examples to give an overview.
Life insurance can be used to create an estate (wealth):
- Cash at death to retire your debts
- Leave your survivors with a home
- An income for your family
- An emergency fund
- An education fund
- and more
Life insurance can be used to conserve an estate:
- Cash at death to pay the tax and estate fees and avoid a bargain estate sale. An example would be that bills are due at death and your assets are in bricks and mortar. In order to generate cash, your heirs may have to sell at a loss to pay taxes and other bills.
- Cash at death to provide for favourite charity.
- Cash at death for estate equalization, you want to give a fixed asset to one heir and to be fair, provide cash to another.
- Business life insurance to protect an important asset.
There are a number of additional strategies available that use life insurance to conserve or increase the value of your estate and to provide you with living benefits as well. It all depends on your individual objectives.
There is additional information on Estate Planning on my website www.jpw.ca
If you have further questions, or feel that I could be of assistance, please do not hesitate to contact me.
If you would like to work with a local life insurance broker, you could start with a Google search. For example, if you search for: life insurance broker Halifax or life insurance agent Halifax, my name, along with several others, will come up. You can use the same method to find a life insurance broker in your community.
Estate planning is the process used to distribute or dispose of one's estate before and/or after one's death. Life insurance is a financial product that pays out at death. Therefore, life insurance is good fit for estate planning.
Some things that people look for in estate planning are simplicity, minimizing taxes, the ability to have control over their assets, contingencies for if they are incapacitated, and above all, the ability to pass their wealth on to whom they desire. Life insurance normally passes income tax free to the beneficiary of one's choice, and once the policy is in place, there is little to nothing that has to be done to maintain it. Only the owner of the policy can change it. Therefore, life insurance meets many of the criteria that people look for when planning the disposal or transfer of their estate.
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
Life insurance provides cash at the time of death. Estate planning involves distributing assets at the time of death. Often the estate needs liquidity so that key assets do not have to be sold to pay debtors or taxes. In other cases, the business should pass to one heir and yet the parents might want to provide equally for other heirs. There are as many problems as there are families and life insurance can solve many estate problems.
That is an excellent question! The best things about life insurance when it comes to estate planning are that first, it isn't taxable. It is an excellent way of transferring wealth without paying taxes. Second, it is usually not held up in probate, and therefore the funds are released to the beneficiary without any issues. That said, if your estate is a large one, you may need to put some thought into how the policy is structured, to avoid potential problems. Please consult an attorney, financial planner, or tax advisor, and your agent to be certain of the best route for you. Thanks for asking!
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Life insurance can be used in numerous ways to help you achieve your estate planning objectives. In fact, there are too many to be completely covered here, so I will provide a few examples to give an overview.
Life insurance can be used to create an estate (wealth):
- Cash at death to retire your debts
- Leave your survivors with a home
- An income for your family
- An emergency fund
- An education fund
- and more
Life insurance can be used to conserve an estate:
- Cash at death to pay the tax and estate fees and avoid a bargain estate sale. An example would be that bills are due at death and your assets are in bricks and mortar. In order to generate cash, your heirs may have to sell at a loss to pay taxes and other bills.
- Cash at death to provide for favourite charity.
- Cash at death for estate equalization, you want to give a fixed asset to one heir and to be fair, provide cash to another.
- Business life insurance to protect an important asset.
There are a number of additional strategies available that use life insurance to conserve or increase the value of your estate and to provide you with living benefits as well. It all depends on your individual objectives.
There is additional information on Estate Planning on my website www.jpw.ca
If you have further questions, or feel that I could be of assistance, please do not hesitate to contact me.
If you would like to work with a local life insurance broker, you could start with a Google search. For example, if you search for: life insurance broker Halifax or life insurance agent Halifax, my name, along with several others, will come up. You can use the same method to find a life insurance broker in your community.
Some things that people look for in estate planning are simplicity, minimizing taxes, the ability to have control over their assets, contingencies for if they are incapacitated, and above all, the ability to pass their wealth on to whom they desire. Life insurance normally passes income tax free to the beneficiary of one's choice, and once the policy is in place, there is little to nothing that has to be done to maintain it. Only the owner of the policy can change it. Therefore, life insurance meets many of the criteria that people look for when planning the disposal or transfer of their estate.