Although well-meaning, my husband and I are perpetually running late. We are late for everything—missing the first two minutes of a movie, showing up 30 seconds too late to see the balloon drop at a New Year’s Eve party, showing up to a physical therapy session five minutes late… Sound familiar?
When it came to finances, my husband and I managed to keep up on bills and our credit scores were decent, but we were always just doing the minimum to keep our heads above water. Saving enough funds for a couple trips, enough to pay the bills, and maybe throw a couple bucks into long term savings.
There is a game changer in this equation: our daughter.
Photo by Aditya Romansa on Unsplash
She has been the single greatest catalyst in our lives and has forced us to address the facts about sound financials and estate planning. We were especially concerned about the potential for an accident involving both me and my husband.
Gordon set us up with a complete estate plan. It wasn’t nearly as complicated (nor as expensive) as we would have thought.
My husband and I took special care selecting her guardians, should something happen to us, as well as setting up a trust for her to gain access to assets after her 18th birthday.
We plan to revisit the estate plan annually, just to make sure that everything is current. In addition to her college fund, it is our way of taking her financial security seriously and planning for the unexpected. Maybe she’ll forgive us for the chronic lateness she inherited with the knowledge that she has also inherited a strong financial support system in place to help her, no matter what.
Note from Gordon: If you’re like this client (who wished to remain anonymous), children and grandchildren can mean you’ll pursue legal and financial actions you never thought of before to ensure piece of mind that they’ll be taken care of if something happens to you. There’s no harm in giving me a call or shooting me an email to at least talk about what you may need in terms of an individualized estate plan. I look forward to working with you!
https://www.gordonfischerlawfirm.com/wp-content/uploads/2017/08/kelly-sikkema-325963.jpg19873000Gordon Fischerhttps://www.gordonfischerlawfirm.com/wp-content/uploads/2017/05/GFLF-logo-300x141.pngGordon Fischer2017-08-07 15:48:572020-05-18 11:28:58From a Client: Why we Chose to Hire Gordon Fischer to Create our First Estate Plan
When you think about estate planning, life insurance doesn’t come to mind first. Your house, collectibles, and 401k? Sure. Yet, life insurance is present in almost every quality estate plan and can serve as a source of support, coverage, and liquidity to pay death taxes, expenses, fund business buy-sell agreements and sometimes to fund retirement plans. A life insurance policy, when used correctly, can be used to protect your estate and ensure your lasting legacy. Yet, for even the savviest of people who have a plan in place for the future, how life insurance fits into the estate planning puzzle can prove complicated.
Enter Christa Payne, a Financial Representative for Country Financial in North Liberty, who was generous enough to share her expertise on the subject. Christa has been with Country Financial for over seven years and you can tell she’s passionate about what she does. She finds joy in being a part of planning for the future for all her clients.
Gordon Fischer Law Firm (GFLF): In general, what role does a life insurance policy play within an estate plan?
Christa Payne: Generally, life insurance is a great vehicle to provide estate liquidity (in order to pay taxes, debts, administrative expenses, family allowance for surviving spouses and dependents). It can also provide debt relief or continuation plans (buy-sell for businesses, etc.), provide income replacement, and wealth accumulation…proceeds are paid to beneficiaries income tax-free!
GFLF: Can life insurance affect the amount of taxable assets of the estate?
CP: Yes, if you are the owner of the policy, it gets added into estate calculation (up to $5.49 million as of 2017). However, if you give up rights to the policy for longer than three years, it doesn’t have to be included. There are steps you can take to make sure that the death benefit or the replacement value don’t get included in the estate calculation.
GFLF: What are the options for charitable giving with/through a life insurance policy? Can you “give” or transfer your policy to a charity?
CP: Premiums can be deductible, but the owner and beneficiary both have to be the charity. Yes, you can transfer your policy to a charity or purchase a new one. Life insurance can be a great way to turn a smaller cash donation into a larger donation!
GFLF: What are some errors you’ve heard of/seen in regards to life insurance and estate planning? What should people know to avoid these pitfalls?
CP: There are many errors that can be made, including: listing the wrong beneficiary (or failing to update as things change—beneficiaries trump a will!) and having an inadequate amount of coverage in force are two major ones. People should always meet with a competent financial professional and attorney to discuss their life insurance and estate plan. It’s vital to complete annual reviews of the policy, as simple as that seems, things change, and it’s easy to forget. It’s always great to be reminded of what policy you have, how it works, and what will happen in the event of a death.
GFLF: What’s the difference for life insurance between revocable and irrevocable trusts? Is one category recommendable over another?
CP: In a revocable trust, there is no gift tax on funding the policy and it avoids probate. The death benefit, however, is included in the grantor’s gross estate. In an irrevocable trust, it avoids probate, has asset protection against creditors, and is excluded from gross estate. One is not necessarily better than the other, it depends on the specific needs of each individual client at the time the trust is established.
Let’s Talk About Your Life Insurance
Take it from Christa, life insurance as a part of your estate plan is important. If you have questions on her advice or think you need a new/updated policy, don’t hesitate to give her a call at 319-626-3516 or shoot her an email. (A resource like this research can also be useful in comparing insurance plans.)
Of course, you also need an estate plan before life insurance an be a part of it)! Contact me to get started or fill out my obligation-free estate plan questionnaire.
https://www.gordonfischerlawfirm.com/wp-content/uploads/2017/06/sunset-e1498480865777.jpg21995152Gordon Fischerhttps://www.gordonfischerlawfirm.com/wp-content/uploads/2017/05/GFLF-logo-300x141.pngGordon Fischer2017-06-26 06:02:172020-05-18 11:28:58Expert Interview: Life Insurance & Your Estate Plan
GoFisch is ever-evolving and I tried out a new look on this month’s newsletter. Give GoFisch a read, subscribe, and share it with your friends & colleagues to stay in-the-know with all things Gordon Fischer Law Firm. (If you missed last month’s edition of GoFisch, you can read it here.)
From a Client: Why we Chose to Hire Gordon Fischer to Create our First Estate Plan
Estates & Estate Planning, From Gordon's Desk...Although well-meaning, my husband and I are perpetually running late. We are late for everything—missing the first two minutes of a movie, showing up 30 seconds too late to see the balloon drop at a New Year’s Eve party, showing up to a physical therapy session five minutes late… Sound familiar?
When it came to finances, my husband and I managed to keep up on bills and our credit scores were decent, but we were always just doing the minimum to keep our heads above water. Saving enough funds for a couple trips, enough to pay the bills, and maybe throw a couple bucks into long term savings.
There is a game changer in this equation: our daughter.
Photo by Aditya Romansa on Unsplash
She has been the single greatest catalyst in our lives and has forced us to address the facts about sound financials and estate planning. We were especially concerned about the potential for an accident involving both me and my husband.
We decided to create an estate plan with Gordon because we needed reassurance that should anything happen to us, she would be cared for with as minimal amount of legal hiccups as possible.
Gordon set us up with a complete estate plan. It wasn’t nearly as complicated (nor as expensive) as we would have thought.
My husband and I took special care selecting her guardians, should something happen to us, as well as setting up a trust for her to gain access to assets after her 18th birthday.
We plan to revisit the estate plan annually, just to make sure that everything is current. In addition to her college fund, it is our way of taking her financial security seriously and planning for the unexpected. Maybe she’ll forgive us for the chronic lateness she inherited with the knowledge that she has also inherited a strong financial support system in place to help her, no matter what.
Note from Gordon: If you’re like this client (who wished to remain anonymous), children and grandchildren can mean you’ll pursue legal and financial actions you never thought of before to ensure piece of mind that they’ll be taken care of if something happens to you. There’s no harm in giving me a call or shooting me an email to at least talk about what you may need in terms of an individualized estate plan. I look forward to working with you!
Expert Interview: Life Insurance & Your Estate Plan
Estates & Estate Planning, From Gordon's Desk...When you think about estate planning, life insurance doesn’t come to mind first. Your house, collectibles, and 401k? Sure. Yet, life insurance is present in almost every quality estate plan and can serve as a source of support, coverage, and liquidity to pay death taxes, expenses, fund business buy-sell agreements and sometimes to fund retirement plans. A life insurance policy, when used correctly, can be used to protect your estate and ensure your lasting legacy. Yet, for even the savviest of people who have a plan in place for the future, how life insurance fits into the estate planning puzzle can prove complicated.
Enter Christa Payne, a Financial Representative for Country Financial in North Liberty, who was generous enough to share her expertise on the subject. Christa has been with Country Financial for over seven years and you can tell she’s passionate about what she does. She finds joy in being a part of planning for the future for all her clients.
Gordon Fischer Law Firm (GFLF): In general, what role does a life insurance policy play within an estate plan?
Christa Payne: Generally, life insurance is a great vehicle to provide estate liquidity (in order to pay taxes, debts, administrative expenses, family allowance for surviving spouses and dependents). It can also provide debt relief or continuation plans (buy-sell for businesses, etc.), provide income replacement, and wealth accumulation…proceeds are paid to beneficiaries income tax-free!
GFLF: Can life insurance affect the amount of taxable assets of the estate?
CP: Yes, if you are the owner of the policy, it gets added into estate calculation (up to $5.49 million as of 2017). However, if you give up rights to the policy for longer than three years, it doesn’t have to be included. There are steps you can take to make sure that the death benefit or the replacement value don’t get included in the estate calculation.
GFLF: What are the options for charitable giving with/through a life insurance policy? Can you “give” or transfer your policy to a charity?
CP: Premiums can be deductible, but the owner and beneficiary both have to be the charity. Yes, you can transfer your policy to a charity or purchase a new one. Life insurance can be a great way to turn a smaller cash donation into a larger donation!
GFLF: What are some errors you’ve heard of/seen in regards to life insurance and estate planning? What should people know to avoid these pitfalls?
CP: There are many errors that can be made, including: listing the wrong beneficiary (or failing to update as things change—beneficiaries trump a will!) and having an inadequate amount of coverage in force are two major ones. People should always meet with a competent financial professional and attorney to discuss their life insurance and estate plan. It’s vital to complete annual reviews of the policy, as simple as that seems, things change, and it’s easy to forget. It’s always great to be reminded of what policy you have, how it works, and what will happen in the event of a death.
GFLF: What’s the difference for life insurance between revocable and irrevocable trusts? Is one category recommendable over another?
CP: In a revocable trust, there is no gift tax on funding the policy and it avoids probate. The death benefit, however, is included in the grantor’s gross estate. In an irrevocable trust, it avoids probate, has asset protection against creditors, and is excluded from gross estate. One is not necessarily better than the other, it depends on the specific needs of each individual client at the time the trust is established.
Let’s Talk About Your Life Insurance
Take it from Christa, life insurance as a part of your estate plan is important. If you have questions on her advice or think you need a new/updated policy, don’t hesitate to give her a call at 319-626-3516 or shoot her an email. (A resource like this research can also be useful in comparing insurance plans.)
Of course, you also need an estate plan before life insurance an be a part of it)! Contact me to get started or fill out my obligation-free estate plan questionnaire.
Read GoFisch: June Edition
NewsletterGoFisch is ever-evolving and I tried out a new look on this month’s newsletter. Give GoFisch a read, subscribe, and share it with your friends & colleagues to stay in-the-know with all things Gordon Fischer Law Firm. (If you missed last month’s edition of GoFisch, you can read it here.)