As you will soon discover when meeting with an attorney to discuss estate planning, the process involves more than just creating a will or trust. A good estate plan will also factor in retirement assets, disability planning, and insurance products. Even if you are relatively young when creating your estate plan, insurance products in particular can be an important part of the estate planning process.
5 Reasons to Consider Insurance Policies as Part of Estate Planning While Young
Why should you consider incorporating insurance products into your estate plan even while you are young? The following is an overview:
- While you are young and healthy, term life insurance is often very inexpensive. A relatively small sum can purchase a significantly large policy.
- If you die unexpectedly, the proceeds of the policy can be used to pay off your bills. These bills may include a mortgage, student loans, credit card debt, or medical debt.
- If you die leaving a spouse, the proceeds of an insurance policy are important in order to benefit your surviving spouse and replace your lost income. In addition, if you have small children, the proceeds can be used to pay for child care or college tuition.
- The proceeds of your policy can also be used to leave a legacy to your loved ones if you otherwise do not have significant assets to pass on at this stage in life.
- Depending on your age and overall needs, it may also be a good time to consider long-term care insurance. If you wait until you are significantly older to purchase this type of policy, you may no longer be eligible.
Creating an estate plan can feel overwhelming with many considerations to factor into the process. We encourage you to learn more by checking out our free pamphlet, The Ten Things You Must Know Before Creating (or Amending) Your Will or Trust.