One of the most important things to be mindful of in planning for your estate is how you list beneficiaries on assets that will pass outside of a traditional will. One such example is from your life insurance policy. 
You likely purchase your life insurance policy as a way to protect your loved ones if something were to happen to you. However, be careful about how you list this in your overall estate plan. It might not be the right idea to have your life insurance proceeds payable to an estate. This is because one common consideration is creditors. Creditors may not able to touch life insurance proceeds if those life insurance policy payouts went to an individual.
However, a creditor could potentially access life insurance proceeds that are payable to an estate. Even if you don’t currently have any outstanding debts right now, it’s difficult to know what might be associated with your debt. There could be last minute charges from ambulance rides or emergency room visits that can come about if you were to suddenly get very sick.
You might have thought that making your life insurance proceeds payable to the estate so that there is money available for burial and expenses is a good idea. However, this might not provide the immediate support that your loved ones need to pay for a funeral. Sometimes another form of savings can be helpful in allowing for this to occur due to the quick period of time necessary for your loved ones to plan your burial or memorial service.
Need more planning tips? Set up a time to chat with your estate planning attorney for customized strategies and tools.
Disclaimer: This blog post is for informational purposes only and does not constitute legal advice. Reading this content does not create an attorney-client relationship. For legal advice specific to your situation, please consult with a qualified attorney.
Disclaimer: This blog post is for informational purposes only and does not constitute legal advice. Reading this content does not create an attorney-client relationship. For legal advice specific to your situation, please consult with a qualified attorney.