3 Benefits of a Life Insurance Trust

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The time has come when you are ready to start getting your affairs in order. However, you may be struggling as far as where to start or what is necessary for you to include in this big step in planning for your future. One of the big steps you can take deals with life insurance. While you may not be familiar with them, these three benefits of creating a life insurance trust will provide insight as to how you can properly get started.

Protect Your Beneficiaries

When it comes to setting up a life insurance trust in Florida, you may be wondering why it is not enough to simply set up a normal life insurance policy instead. This is a valid question. While a life insurance policy will offer some protection by itself depending on what kind of policy you have chosen, a trust goes a step further and guarantees protection of your beneficiaries.

While your chosen beneficiary on your life insurance can get the money easily enough, that money is not guaranteed to be protected. If you or your beneficiary has a lot of debt, creditors can come after your beneficiary and hound them to give up the life insurance money to pay them. If your beneficiary were to get married, then get divorced, that life insurance money could be targeted as another source of income that they need to split, especially in a no-fault state. A trust allows you to protect your beneficiaries from having to give any of the money they received from that trust to creditors or anyone else who wants to try and get it.

Keep Out of the Courts

One of the most agonizing things for a grieving family to deal with is having to put the will of their loved ones into probate court. When a will is put into probate, everything discussed in the will is put on hold until it is resolved. Such a resolution might not come for months or years after the motion has been filed. Odds are that your family will not be able to wait that long to get you taken care of you. A trust requires that everything is signed, sealed and notarized, so you will not have to worry about that trust going into probate.

Get Those Taxes Down

No matter the size of the estate or value of the property that you are putting into the care of your beneficiary, they will more than likely be worried about the taxes that will be coming with all of that. Having your estate or other property of significant value under the protection of a trust will help cut down on taxes and will help with settling the estate after you die. After all, not many people have enough money in their bank account to settle their estate on their own, and there is a good chance that you are also not one of those people. The trust will give you the ability to eliminate worry and make it affordable for your beneficiary to inherit.

This is never something that people enjoy thinking about. However, it is vital to have your affairs in order, so that when you die, your beneficiaries are not left scratching their heads and wondering what to do. A life insurance trust will keep everyone and everything protected, without the hassle of court systems or financial conflict. Hopefully, these three benefits have shed some light on why a life insurance trust might be the path to take. Once everything is put into place, you can rest easy knowing that you have all loose ends tied up.