Coporate Profiles

Choosing a Life Insurance Beneficiary:

Who should receive the insurance policy proceeds?

When naming your spouse:

1. Your spouse may be hounded with bad investment advice if they are not well versed in finance.
2. There might be pressure on your spouse for gifts or loans from other family members.
3. If the proceeds are paid directly to your spouse, they cannot fund a credit shelter trust to take advantage of the current $675,000 applicable exclusion amount. An overfunded marital deduction often ultimately results in higher estate tax.
4. The proceeds may become subject to rights and claims of your spouse’s next spouse.
5. The proceeds become subject to the claims of your spouse’s current and future creditors.

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When naming your children:

1. Your children my not have the maturity to handle money.
2. Your children or spouse may be hounded with bad investment advice
3. Designate your then living issue or descendants per stirpes or by representation so that children of a deceased child will take the deceased child’s share.
4. You could be excluding a future grandchild through a deceased child.

Death n Taxes
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When naming your Estate:

1. You can use of spendthrift trusts so dependents aren't given a huge lump some at once to go and party.
2. Your benefit may not qualify for the inheritance tax exemption provided by your State since there is not a named beneficiary. In such states, a higher tax may be owed.
3. Because of lower estate taxes, the estate will be larger and may result in higher executor fees and attorney fees — especially when the fees are based in part on the size of the probate estate.
4. The proceeds will become part of your probate estate and may be subject to creditors’ claims (though some state laws protect the proceeds from creditors).

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