FAMILY INSURANCE

Special Needs Trust

What Is A Special Needs Trust?

A Special Needs Trust is created to ensure that beneficiaries who are disabled or mentally ill can enjoy the use of property which is intended to be held for their benefit.

In addition to personal planning reasons for such a trust (the person may lack the mental capacity to handle their financial affairs) there may be fiscal advantages to the use of a trust. Such trusts (sometimes referred to as “irrevocable trusts”) may also avoid beneficiaries losing access to essential government benefits. It is a mechanism that will allow the parents of a child with a special needs (for instance, a blind child) to provide for the financial needs of such child if the parents can no longer do so.

Financial Assets To Fund Special Needs Trusts

Obviously assets are needed to fund the trust that will provide for the financial needs of the, in this case, child. The person with special needs could also be an adult. If there are no assets readily identifiable to fund the trust, the trustee of the special needs trust may purchase a life insurance policy on the life of the person who has been providing for the financial needs of the child, which upon the death of such person, will then fund the trust.

A special needs trust is designed to:

  • Ensure that the assets are used to meet the financial needs of the person with special needs.
  • Preserve the federal or state benefits that such person is entitled to receive

 It should also be noted that:

  • Using a life insurance policy to fund the trust, the death benefit proceeds are received by the trust income-tax-free.
  • The death benefits can be excluded from the estate value for federal tax purposes.
  • The trustee can access the cash value of the whole life policy if the provider who cares for the child can no longer provide such care.

 NOTE: This writing is not legal advice. Each person’s situation is different and being a financial matter that requires the drafting of legal documents (for, instance, an irrevocable life insurance trust) an attorney, or legal adviser, must be consulted before reaching any decisions regarding the creation of the special needs trust. As life insurance agents, we will work with your attorney or legal adviser in selecting the best whole life policy to meet your financial situation. Or if you do not have a legal adviser, or attorney, we can recommend two or three for you to select the one you would prefer to work with.

 If you would like us to assist you regarding your SPECIAL NEEDS TRUST, please, call our Toll Free Number (888) 950-8376, or go to Contact Us.

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Whole Life Insurance

About Whole Life Insurance

Whole life insurance is permanent life insurance. It does not expire as long as the premium is paid when due. Whole life insurance is also called csh value insurance, because it accumulates value over time. Term life insurance, on the other hand, expires at the end ot the period and does not accumulate cash value.

The key to whole life insurance is guarantees.

  • Guaranteed Premium Payments. Unlike other types of  cash value life insurance, you can be sure that the cost of your policy is fixed from the moment you buy it.
  • Guaranteed Death Benefits; Knowing t  hat a death benefit will be available to your heirs – no matter when you die – is the primary reason for purchasing a whole life policy.  and
  • Guaranteed Cash Value, which combined with the potential for dividends, make whole life  a unique product. For retirement planning purposes, the cash value illustrated in later years becomes more credible when guraranteed cash represents a significant portion of the asset.

Whole life, which is also called Cash Value Life Insurance,  is life insurance for the whole of life. With its lifetime guaranteed cash value, guaranteed premiums and guaranteed death benefit, no other financial product provides such lifelong security.

Whole Life Insurance and the “Financial Gurus”

Despite these qualities, some consumer finance “experts” in the news media have criticized whole life because it costs more than term life or universal life for the same amount of coverage. Despite being one of the most misunderstood of all financial products, whole life has worked for families and businesses for more than 200 years. Compared to term life insurance, whole life has higher premiums. But it also delivers more, the same way a car costs more than a bicycle; both vehicles can get you where you want, but a car offers more utility for the money. Form more on this you can click on Term to Perm to visit our post on this topic.

Whole Life Insurance and Retirement Planning

Whole life can be a surprisingly versatile financial tool, with ongoing cash accumulation and instant liquidity through policy loans. It can even generate tax-favored retirement cash flow. And, it ultimately pays a death benefit that is free of federal and state income tax.

Want to Find Out More If Whole Life Insurance is For You?

While the INSURANCE GLOBE PARTNERS site is primarily dedicated to TERM LIFE INSURANCE, to SENIORS LIFE INSURANCE and to FINAL EXPENSE LIFE INSURANCE, it is appropriate to also talk in here about whole life insurance. After all, term life insurance is life insurance purchased to meet a temporary need. It will expire when its term ends and to renew it at that point becomes very expensive. Also, if the insured’s health has deteriorated, renewal of the policy after expiration may not even be an option. Therefore, when one is looking for life insurance, whole life should not be automatically excluded.

Call us at our Toll Free Number 888-950-8376 for a freee personal consultation; or,  go to Request Free Consulation.

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…If You Are Not Ready for Whole Life Insurance…

If you are not ready for whole life insurance and are looking for a cheaper alternative, please read on!

Without doubt, whole life insurance is not only one of the top products of the industry, but also an important investment vehicle to be considered for wealth accumulation purposes, in particular if you are in the, well, wealth accumulation phase of your life. A properly structured whole life policy can offer: safety; tax-deferred growth; a competitive rate of interest; protection from creditors; does not limit how much money you can put in it; and it could be used as collateral, among other uses.

Whole life insurance is more costly than term and if you are looking for the benefits that whole life offer but find that your current budget just won’t allow you to make the necessary premium payments, you may go for a type of term life insurance the permits you to transition later in life into whole life. They perform as a bridge from term to perm. For instance, in you convert within the first 5 years of the policy, every dollar that you spend (in term premiums) can be recaptured and credited toward the first-year premium of a new permanent life insurance policy.

For a free analysis of how this could work for you, call us at our Toll Free Number 888-950-8376, or click on CONTACT US , write to us, and one of our licensed agent will get in touch with you ASAP!

 

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Universal vs Whole LIfe

Looking For Life Insurance?

Looking for life insurance but not sure about Universal vs Whole Life?

If you have avoided the topic of life insurance, and has now realized you can no longer ignore it, you may be undecided between permanent or temporary life insurance. Then you must also have wrestled with the issue of Universal vs Whole Life when considering permanent life insurance. Both Universal Life Insurance as well as Whole Life Insurance are permanent forms of life insurance. Let’s see below how they are alike and how they are different.

Should You Go For Term Life Insurance?

For many people owning Term Life Insurance is an effective way to protect their families and others who depend on them, particularly for the short-term.

The great majority of these same people, however, also want the added protection and flexibility of permanent insurance but are unsure as to which type is right for their situation.

The type of permanent insurance which is best for your depends on your preferences and attitudes toward a range of factors such as risk preference, flexibility, guarantees and your retirement and legacy objectives.

Is Whole Life Insurance For You?imagesCA9T22D2

If you prefer a policy that that has both guaranteed death benefit protection as well as a guaranteed form of cash value growth, you should look into a Whole Life policy.  Whole Life Insurance has guaranteed level premiums and guaranteed cash value and also guaranteed death benefits.  Whole life policyholders are eligible to receive annual dividends, as declared by the insurance company.  Please, note that dividends are not guaranteed. However. If paid, they may increase the cash value and death benefits over time.  In general, it should be noted, a dividend-paying whole life policy will cost approximately twice as much as a universal life policy. Still, one you take into account dividends paid over time, which actually represent a no-risk return of capital, Whole Life Insurance could very well be a logical addition to your assets classes.

Or Universal Life?

If you prefer a policy with guaranteed death benefit protection over the potential for cash value growth, you should think about Universal Life Insurance with a guaranteed death benefit.  Universal life generally provides a guaranteed premium and can be designed to provide a guaranteed death benefit and typically does not focus on cash value accumulation.

Contact Us For A Free Customized Quote

For an a life insurance quote illustration (TERM, and/or WHOLE LIFE and/or UNIVERSAL LIFE), or if you have any questions, please call our Toll Free Number 888-950-TERM (8376).