To our current clients and those wishing to hire us: Our law firm is considered an “essential business” and can continue to serve the public during the current COVID-19 shutdown. To protect your safety we are offering to meet either in person, taking all of the recommended precautions, via telephone or through video conference. Please call our office to discuss your options. Thank you.
LeVine, Ehrman & Horberg Ltd. - Tinley Park Family Law Attorneys
for a free consultation

FORWARD FOCUSED. RESULTS DRIVEN.

A trust could be a good choice for your life insurance payout

| Feb 19, 2020 | Estate Planning |

You didn’t think you’d be worried about your estate plan this early in life, but with a child on the way, you’ve realized that you want to make sure they’re cared for in the event that something happens to you or your spouse. You want to know that your child will not only be cared for by someone you trust but also have the money they need as they grow older.

One interesting thing you may want to consider is setting up a life insurance policy that will payout into a trust for your child if you pass away. Doing this helps you minimize the taxes that could come out of the life insurance policy and also protects the money against being used too quickly.

Here’s an example. Imagine your child is 10 when you and your spouse pass away unexpectedly. Your life insurance policies pay out into a special trust that will make payments to your child and their guardian, respectively, until your child turns 18. At that time, the trust, at your discretion, could pay out the remaining money. Alternatively, you could opt to set up a trust that pays out only for major life events, like for college or marriage, or pays a portion of its contents each year, such as $50,000 a year for 10 years if there is $500,000 invested in the trust.

How you set up a trust will vary based on your specific needs and wants. Your attorney will talk to you more about the trust options that are open to you and work with you to establish the right one for your estate.