Many people do not want to think about dying or what will happen after they pass away. However, for the financial security of your loved ones it is important that you do consider the consequences.
Many people know the basics of life insurance – you find a policy, pay a monthly premium and if you pass away then your chosen beneficiaries will receive a payout.
On the outset, it sounds simple to take out a life insurance policy. However, picking the right life insurance for yours and your family’s needs might be more complex. A financial adviser at Four Wealth Management can help you navigate the various options available to you and make sure that you get the correct level of cover for your individual circumstances.
You can book in a meeting with a financial adviser to discuss your protection needs or call us on 0117 973 0500.
Did you know you can put your life insurance into trust?
If the worst does happen then your life insurance could pay out a large cash lump sum to your chosen beneficiaries. You can choose to put your life insurance policy into trust which reduces your inheritance tax liability as the payout isn’t included in your estate.
Inheritance tax is up to 40% of your estate value over the nil rate band of £325,000. Putting the life insurance into trust means that your beneficiaries can get the full payout.
Putting it into trust also means that the money is released quicker as you do not need to wait for probate which is a better outcome for your loved ones.
Another advantage of putting your life insurance in trust also means that you can define who benefits from what you leave behind and who you’d like to manage it.
What is a trust?
A trust is a legal arrangement that allows you to leave money or assets to your chosen beneficiaries. A trust is managed by trustees, such as family, friends or a solicitor.
Life insurance is an asset and can be put into trust.
How do I put my life insurance into trust?
You can put both new or an existing life insurance policy into trust. You should first speak to a financial adviser to make sure that putting it into trust is right for your individual circumstances.
If you do decide to put your policy into trust then you need to decide who you want to be the trustees and the beneficiaries.
At Four Wealth Management, we can help you to complete the relevant paperwork to put your life insurance policy into trust.
Book in a meeting with a financial adviser to discuss your protection needs or call us on 0117 973 0500.
The levels and bases of taxation and reliefs from taxation can change at any time. The value of any tax relief depends on individual circumstances.
Trusts are not regulated by the Financial Conduct Authority
