Recent studies have found that the opposite is true. Research by the AARP found that more than 80 percent of Baby Boomers have not received an inheritance. Many Baby Boomers do not even expect to receive a significant inheritance. This is due in part to the cost of long-term care, longevity of life, reverse mortgages and splitting the inheritance among children, grandchildren, charities and alma maters.
As advisors it is our responsibility to assist our clients, whether Boomers or their parents, to prepare them for the wealth transfer process and educate them on techniques to maximize the amount of money they can pass on to the “waiting” generation. Life insurance is one way to put your client’s mind at ease in this area.
Seniors are often worried or uneducated about the process of taking their life’s worth and assuring it will be effortlessly transferred from one generation to the next. As advisors we need to remember, regardless of the size of our client’s estate, there are legal, accounting and emotional controversies that arise during the wealth transfer process.
Life insurance allows a client to transfer money tax-free and actually create money where none existed before. When life insurance is received by the beneficiary, properly structured it can be received tax-free, often in a couple of weeks. The money is not held up in probate and it does not have the associated fees of real estate brokers, appraisers, lawyers, accountants and trust officers.