Your first taste of estate planning may be presented to you without you actually seeking it out. Many employers offer life insurance as a paid benefit. A base amount of coverage is afforded to you at no cost. If you want to increase the coverage you can pay for the additional coverage out-of-pocket.
This opportunity can get you thinking about the situation that you would be leaving behind if you were to pass away.
Over the years estate planning may see more and more relevant as you get married, have children, and start to accumulate a significant store of financial resources.
Insurance can serve as an excellent income replacement vehicle, but it also has other uses within the field of estate planning. Life insurance is at the core of buy-sell agreements that are utilized in small business succession planning for partners.
If you’re looking for a way to balance inheritances life insurance can be a good option. Inheritance balancing comes into play when you want to give something of great value to one of your heirs without splitting it up to divide the value equally. You can balance things out by making the heir that will not be receiving this piece of property the beneficiary of a life insurance policy.
These are some of the uses for life insurance, but it actually does no good at all if the beneficiary never comes forward to claim the proceeds. Some $1 billion sits unclaimed according to Consumer Reports.
Many people like to keep their financial affairs private, even from family members. However, you would do well to make sure that interested parties are aware of the fact that you have insurance policies on your life if this is in fact the case.