Use Life Insurance to Leave a Legacy

The Merriam-Webster Dictionary defines Legacy as a “gift by will especially of money or other personal property”. Many people leave a legacy every year as part of their last will and testament.  This legacy comes in the form of cash being left to honor other individuals, institutions, religious organizations, or charities they feel very strongly about. The gift, in some cases many years in the making, comes as a result of financial success. Just take a look at any named college building, scholarship, or hospital wing as an example. At some point, we all reaped a benefit from one of the above legacies.    

How many of us would like to leave something behind to benefit others?  How many of us would like to leave an impact after we are gone?  The answer is probably most people.  Unfortunately, many individuals don’t carry through with this because of their financial situation.  Let’s be honest, the examples above were left by men and women who were very wealthy and possessed a high-net-worth.

However, this is a relatively inexpensive strategy that allows for a middle class or working class individual to leave their mark.  You can purchase a life insurance policy and name any individual or organization as the benefactor.  For example, a 50-year-old male, non-smoker, with an income of $40,000 per year wants to set aside $45.00/month to leave to the university from which he graduated. This would help fund a scholarship for students majoring in history. For this cost, the man would fund a $100,000 term life insurance policy, plus if he adds a waiver of premium rider, the policy will stay in force if he should become disabled and can no longer pay the premiums.  Upon his death, our man’s wish of leaving something to his university is accomplished. The university receives $100,000 tax-free which they then use to set up a scholarship for history majors; to show their gratitude, the scholarship will bear his name. Not bad for a middle-income earner.

If you wish to leave a legacy, life insurance can provide the answer.  You don’t have to be rich to use this strategy and the premiums are affordable.  An advisor or life insurance agent can help you make a difference that will last for generations.

Matt Dressel is the Owner of the Independent Financial Solutions Group, a Registered Investment Advisor. He is an Investment Advisor, Life Insurance Agent and does Financial Planning.  If you have any questions about this article, he can be reached at 252-515-0242 or matthewdressel.ifsg@gmail.com.

(Life Insurance Benefits could be subject to the claims-paying ability of the Life Insurance Company.)