Male   Female
  • Can life insurance be used to fund a trust after I die?
  • February 21, 2014
  • insurance trust fund


    The term “trust fund” might elicit an image of a spoiled rich kid living off their parent’s money.

    In reality, many parents use the proceeds from life insurance to fund a trust that provides financial payments to their children while limiting their ability to spend it all at once.

    Families who want to provide for heirs can put certain stipulations in place to control how and when the proceeds from the fund will be distributed.

    “Trusts allow you the option to gather up your resources and split them equally among your kids without a tax penalty,” explains Marc Belletsky, Director of Estate and Business Planning for The Hartford.

    A policyholder who doesn’t want certain assets or funds included in their estate may also establish a trust.

    “They’re money-machines that exist outside of the estate that can be used to help pay estate bills after death,” says Belletsky.

    Trusts are also helpful if you have a child with mental disabilities that prevents them from being self-sufficient and earning a regular income. Through its creation, a trust can ensure your child receives regular financial support beyond you or your spouse’s lifetime.

    You could even set up a trust to provide gifts to charitable organizations or seize assets from a spouse to prevent them from being given to another person if they remarry.

  • Category: Articles Library, Life Insurance, Videos

Leave a Reply


About Us  |   Contact Us  |   Press Releases  |   The Best Privacy Policy  |   Life Insurance  |   Careers
For Agents & Brokers  |   Site Map  |  

Copyright ©1984-2018 Life Quotes, Inc., 8205 South Cass Avenue, Suite 102, Darien, Illinois. Life Quotes, Inc. and certain of its personnel are licensed as insurance agents, brokers or producers in all states. CA agent #0A13858, LA agent #200696, MA agent #333509159. dba Life Quotes Insurance Services in CA under agent #0827712, in LA under agent #205078. dba Life Quotes Insurance Services, Inc. in UT under agent #90093. All rights reserved. Telephone (630) 515-0170. Founded 1984.