As we mentioned in previous article, estate planning is the process of accumulating and disposing of wealth before death of individual or group of owner known as estate owner including married couple. It aims is to maximize the wealth of the estate owner.
I. Life insurance
The most important goal of estate planning is to make sure that the greatest amount of the estate passes to the estate owner's intended beneficiaries while paying the least amount of taxes. Life insurance is one of the vehicle can ensure that because life insurance is tax free on hand of beneficiaries upon the death of the estate owner.
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II. How it works
1. The proceeds from the insurance can be used to pay off any probate, taxes and fees and leaving the accumulated wealth of your estate for intended beneficiaries.
2. Under universal life policy, growth of assets in your life insurance policy is tax exempt. The proceed of life insurance plus fund values will be not be taxed on hand of your designated beneficiaries and it can be used to pay off the debts of your estate that accrue at your death.
3. While you are a live, the fund values that are not registered can be withdrawn anytime. Funds that are registered can provide additional income when your retired. Since the funds can be withdrawn anytime, it give some security in case of emergency needs.
4. Life insurance in group plan not only can be used as enhancing employee benefit packages, providing coverage to protect against loss due to the death of a business partner, it also can be used as a strategy to minimize corporate taxes.
I hope this information will help. If you need more information or insurance advices, please follow my article series of the above subject at my home page at:
http://medicaladvisorjournals.blogspot.com
http://lifeanddisabitityinsuranceunderwriter.blogspot.com/
Tuesday, January 6, 2009
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