A beneficiary is a person who will receive the death benefit should you die while a life insurance policy is in place. Who is yours? Is this one of the most difficult decisions you have to make? Life insurance is meant to provide financial support for those people you leave behind, especially those people who are currently relying on your income to maintain their quality of life. There are other reasons to maintain this policy as well, including meeting your goals for after you've died and achieving other needs. But, who should you list as your beneficiary?
The decision of who you write as your beneficiary on any policy is 100 percent your decision. However, there are many things to think about, especially if you are not married. Who should receive these funds?
- Your children. If you have children, they may be the best option for a beneficiary (equally split between them). If they are minors, you may wish for the funds to pay into a trust that is overseen by a trusted family member to care for their needs until they reach a certain age.
- Other dependents. Are you taking care of an elderly parent? Do you have other people that rely on your income? You can list them as your beneficiary.
- Others you want to leave the funds to. There is no rule saying you cannot choose just anyone. It is up to you to decide.
- A charity. You can leave the funds from a life insurance policy to a charity if that is what you like.
- Your estate. The funds can be funneled (and will be if you do not name a beneficiary) into your estate. This means the money is split to pay your creditors and then split with your heirs. This gives you the least amount of control.
Beneficiaries are an important part of life insurance decisions. And, you should have two layers, in case the first person cannot accept the funds for some reason. Take a few minutes to discuss your needs with your loved ones so you can make the best decision going forward.
We’ll help you determine the details of your policy. Call Turrentine Insurance Agency at (281) 476-0557 for more information on Deer Park life insurance.