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Life Health > Life Insurance

Act now to leave a tax-free legacy

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Time is running out. If you have clients hesitating to complete their estate planning, it is essential you encourage them to make these important decisions this year. If they wait, they will miss out on an unprecedented opportunity. Why? Read on.

  • Tax-free giving. As an advisor, surely you’re aware estate taxes were changed to allow Americans to pass down large sums of money to their loved ones tax free. In fact, a single client can give a full $5 million to loved ones while living or at his passing. A couple can leave $5 million per person, resulting in $10 million to be distributed to their family members following their deaths. The catch is that this tax-free giving opportunity only lasts for one more year. When the 2012 calendar ends, so does this current law.
  • The bottom line. If your clients have not done estate planning yet, it is your duty as their advisor to guide them through this once-in-a-lifetime opportunity. If they do not do the planning this year, they may lose thousands, if not millions, of dollars they could have passed down to the next generation.
  • Grow their green. Even if the majority of clients you advise do not have millions of dollars to give to their beneficiaries, there is an opportunity to build a sizable legacy for the next generation. With nothing but a life insurance premium payment and a contract, your clients literally create cash where previously there was none. Life insurance is a unique financial tool to generate cash for future generations. Coupled with the tax-free incentive, this is a great opportunity to create a larger estate for your client without the beneficiaries having to pay income, capital gains or even estate taxes. The death benefit of a life insurance policy can eliminate debt, equalize inheritances between several beneficiaries and guarantee an income stream for a surviving spouse.

Next year offers the rare chance to ensure your clients make the most of every penny for the sake of their loved ones.

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Philip E. Harriman, CLU, CHCF, 2007 MDRT president, is a partner with Lebel and Harriman, LLP.


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