• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

The Potter Law Firm

North Carolina and Kentucky Estate Planning Attorneys

phone iconNC (704) 944-3245
KY (606) 324-5516
Attend A Free Seminar - KY Attend A Free Webinar - NC/SC THIS IS AN ADVERTISEMENT

  • Home
  • About Us
    • About Our Firm
    • Attorney and Staff Profiles
  • Practice Areas
    • Asset Protection & Business Planning
    • Elder Law & Medicaid Services
    • Estate and Gift Tax Figures
    • Family-Owned Businesses & Farms
    • Incapacity Planning
    • IRA & Retirement Planning
    • Legacy Planning
    • Pet Planning
    • Probate
    • SECURE Act
    • Special Needs Planning
    • Trust Administration
  • Elder Law
    • Coping With Alzheimer’s
    • Emergency Medicaid & Nursing Home Planning
    • Guardianship & Conservatorship
    • Hospice Care
    • Medicaid Planning
    • Nursing Home Planning
    • Veterans Benefits
  • Communities We Serve
    • Kentucky
      • Boyd County
        • Ashland
        • Florence
      • Kenton County
        • Covington
        • Fort Mitchell
        • Independence
    • North Carolina
      • Mecklenburg County
        • Charlotte
        • Davidson
        • Huntersville
  • Resources
    • Definitions
    • DocuBank
    • Elder Law
      • Elder Law Links
      • Elder Law Reports
      • Local Elder Law Resources
        • Ashland Elder Resources
        • Covington Senior Resources
        • Huntersville Elder Law Resources
        • Independence Senior Resources
    • Elder Law Reports
    • Emergency Legal Documents
    • Free Estate Planning Seminars
    • Free Estate Planning Worksheet
    • Frequently Asked Questions
      • Estate Planning
      • Frequently Asked Questions for Families Without an Estate Plan
      • IRA & Retirement Planning
      • Legacy Wealth Planning
      • LGBTQ Estate Planning
      • Medicaid
      • Pet Planning
      • Trust Administration & Probate
    • Is Your Estate Plan Outdated?
    • Kentucky Probate Resources
      • Ashland, Kentucky Probate Resources
    • Newsletters
    • North Carolina Probate Resources
      • Huntersville, NC Probate Resources
    • Reports
      • Advanced Estate Planning
      • Basic Estate Planning
      • Elder Law Reports
      • Estate Planning for Niches
      • Trust Administration
  • Contact Us
  • BLOG
Home » Estate Planning » Life Insurance Can Bolster Your Inheritance Plan

Life Insurance Can Bolster Your Inheritance Plan

October 24, 2021 by John Potter

life insuranceFor some, estate planning can be looked upon as an exercise in letting the chips fall as they may. You create a will or a trust and the beneficiaries will receive whatever happens to be left after you are gone.

This is one perspective you can take, but there is an alternate approach. You can proactively endeavor to bolster your legacy through the use of life insurance.

Whole Life Insurance

There are a number of hybrid forms of insurance, but the two most commonly used forms are whole life insurance and term life. Whole life accumulates a cash value when you pay your premiums, and there is a minimum annual interest rate.

The cash value can be withdrawn from the policy, and you can alternately take a loan against it.

In a real sense, you get the best of both worlds with whole life insurance. There is a death benefit that will serve as a form of income replacement if you pass away, but you get something in return for your money while you are living.

The average premium for a $250,000 benefit for a man in good health between 45 and 55 years old who is a non-smoker is between $432 and $674 a month. For a male in the 35 to 45 age group, the average cost is in the $282-$432 range.

Term Life Insurance

The other type of coverage that is widely used is term life insurance, and this is the ideal form of coverage for people who want to protect their families for a prescribed period of time.

There is no cash value, and you decide on the term during which the policy will remain in place. Because there is nothing coming back unless you pass away during the term, the premiums are much lower than whole life insurance premiums.

To give you an idea of the premium you might pay, a 35-year-old woman obtaining $500,000 of coverage might pay between $18 and $29 a month depending on her health.

Buy-Sell Agreements

In addition to the more common uses for life insurance as an income replacement vehicle and/or a legacy enhancer, there are some other reasons why life insurance is used.

A buy-sell agreement can be used by business partners looking for an inheritance planning solution. To provide an example, let’s say that Lisa and Nicole own a successful restaurant. They agree on the value of a share in the business, and they take out life insurance policies.

The death benefits are equal to the value of a business share. When one partner dies, the other partner would use the proceeds to purchase the deceased partner’s share from their estate.

These agreements can also be used for exit purposes so the partners would have the ability to retire or step aside for some other reason. Life insurance does not necessarily have to be the source of funding.

Inheritance Balancing

Life insurance can also be used to balance inheritances. To use another example, let’s say that your son started working for your business full time after he graduated from college. He has been instrumental in its growth, and you are going to leave the company to your son.

You also have a daughter who has never been involved in your business, and you want to leave equal inheritances to your children. To accomplish this goal, you could make your daughter the beneficiary of a life insurance policy with a payout that is equal to the value of your company.

Attend a Free Webinar!

Attorney John Potter conducts webinars on an ongoing basis that are chock full of useful information. The sessions are offered free of charge, and you can see the dates and obtain more information if you visit our webinar page.

Need Help Now?

If you already know that it is time for you to work with a Huntersville, North Carolina or Charlotte, North Carolina estate planning attorney to put a plan in place, we are here to help. You can send us a message to request a consultation appointment, and we can be reached by phone at 704-944-3245.

Our location in Ashland, Kentucky can be reached at 606-324-5516, and our office in Florence, Kentucky can be reached at 859-372-6655.  You can also fill out our contact form if you would rather send us a message.

 

 

  • Author
  • Recent Posts
John Potter
Latest posts by John Potter (see all)
  • What You Need to Know about the Medicaid Look-Back Rule - January 3, 2023
  • How to Pass Down Your Legacy in Your Estate Plan - October 3, 2022
  • Practical Steps to Take after Receiving a Terminal Diagnosis - September 30, 2022

Filed Under: Estate Planning Tagged With: buy sell agreements, inheritance balancing, Life Insurance

Other Articles You May Find Useful

How to Gift to Your Grandchildren in Your Estate Plan
pour-over will
What Happens If I Leave Property Out of My Living Trust?
estate tax
2022 Estate Tax Exclusion Has Been Set
QTIP trust
How Can You Protect Your Children’s Inheritances If You Get Remarried?
probate
Are There Any Probate Shortcuts in North Carolina?
life estate
What Is the Purpose of a Life Estate?

Free Estate Planning Worksheet

There's a lot that goes into setting up a comprehensive estate plan, but with our FREE worksheet, you'll be one step closer to getting yourself and your family on the path to a secure and happy future.
Texting Permission

Follow Us

  • Facebook
  • Instagram
  • LinkedIn
  • RSS
  • Twitter
  • YouTube

Subscribe to Our Blog

  • This field is for validation purposes and should be left unchanged.

Testimonials

default image

Overall The Potter Firm was very professional. They took what could of been a very complicated process and were able to break it down so it was a lot easier to understand. We are confident we now have made the right decisions in our estate planning. Good firm to work with.

DKS & KMS Client Review August 28, 2020

default image

John Potter has been a real pleasure to work with. He is very knowledgeable and explains things in a very simplistic manner so the average person can understand how/why the laws are written. He is very attentive and asks questions in such a way that not only helps him understand your goals, but also helps you think about what type of goals and expectations you should be considering. Exemplary client service.

David J. Client Review August 28, 2020

default image

My husband and I selected Ms. Potter to assist with our small business. She responsive and attentive every time I have a question or need assistance, and is extremely knowledgeable and able to answer any legal question I have had. I know I can count on Ms. Potter for all of my business legal needs and I would highly recommend her to anyone needing legal assistance with such.

Jillian Client Review August 28, 2020

<< Prev
Next >>

Where We Are

Ashland

ASHLAND
1620 Carter Avenue
Ashland, KY 41101-7631
Phone: (606) 324-5516
Fax: (606) 324-4766

Charlotte

CHARLOTTE
15720 Brixham Hill Avenue
Suite 300,
Charlotte, NC 28277
Phone: (704) 944-3245

Huntersville

HUNTERSVILLE
11330 Vanstory Drive
Huntersville, NC 28078
Phone: (704) 944-3245

Northern Kentucky

NORTHERN KENTUCKY
7310 Turfway Road
Suite 550,
Florence, KY 41042
Phone: (859) 372-6655

Office Hours

Monday8:30 AM - 4:30 PM
Tuesday8:30 AM - 4:30 PM
Wednesday8:30 AM - 4:30 PM
Thursday8:30 AM - 4:30 PM
Friday8:30 AM - 3:00 PM

Map/Location

potter_sidbr_map
potter law logo
  • Facebook
  • Instagram
  • LinkedIn
  • RSS
  • Twitter
  • YouTube

The information on this website is for general information purposes only. Nothing on this or associated pages, documents, comments, answers, emails, or other communications should be taken as legal advice for any individual case or situation. The information on this website is not intended to create, and receipt or viewing of this information does not constitute, an attorney-client relationship.

Privacy Policy | Terms of Service | Disclaimer | Site Map | Powered by American Academy of Estate Planning Attorneys

© 2023 American Academy of Estate Planning Attorneys, Inc. THIS IS AN ADVERTISEMENT