Your children depend on you for just about everything. Your love for them motivates you to meet their needs. In the event you cannot be there to provide for them, you can still take steps to ensure their well-being. Estate planning with a life insurance component is one such way. Though insurance companies cannot pay benefits to minor children, you can direct insurance benefits to them indirectly through a trust or a life insurance custodian.
Establishing a Trust
Trusts come in many forms and serve many different purposes. Trusts allow you to transfer assets for a beneficiary into a protected legal structure that is managed by a trustee of your choosing. You can designate the trust as beneficiary of your life insurance policy and name children as contingent beneficiaries. This is a relatively expensive strategy, but it’s a solid form of provision for children.
Selecting a Custodian
The most complicated part of the process of choosing a life insurance custodian is the assessment of qualified people to do the job. You need someone who is willing, able and trustworthy. Once you make the decision, your next move is to fill out and submit the necessary paperwork to your insurance company. You’re done!
Whether establishing a trust or selecting a life insurance custodian, your best option depends on the value of your estate’s assets. Either option ensures your children are well-cared for in your absence