You may actually have more money locked in different instruments without knowing this
. It is possible that you are currently thinking of how to meet day to day financial obligations when what you should be doing is making use of what you have to get what you want. By this, I am specifically referring to you going for a life insurance settlement.
Alright so what exactly is this life insurance settlement? Okay basically it is a financial undertaking in which a life policyholder sells his policy to a third party for an amount, which is more than its cash value and less than the face value of this policy. Consequently, you may have to consider using this option if you are currently experiencing financial difficulties and possess a valid life policy.
Now how this works is this; policyholder sells his policy to a third party; this individual or entity now possesses right to the same policy becoming its beneficiary and will henceforth be responsible for premium payments.
I believe you understand. So after payment is made and life insurance settlement has now been concluded you will now possess enough fund to meet your financial obligations and possibly purchase other items. You may even get more cash than you expected and wish to save the extra funds so that you or your family do not go through a similar ordeal in the future.
Now this can be done, but how? You can, by creating a family trust. Such trust also referred to as revocable living trust is an agreement where you transfer ownership of your right to assets which you possess to the trust and another known as the trustee is appointed by you to oversee and manage the assets even when you are alive.
This family trust allows you to initially be trustee and beneficiary at once depending on if this is permitted by state law. Therefore, this gives you control over your property until such a time as trustees and other beneficiaries are named.
The major advantages that you have with a family trust include: possible tax reduction, possible avoidance of probate proceedings and lastly beneficiaries will likely get quicker access to assets when the time comes.
Notwithstanding this, it is important you don't just go for this life insurance settlement without considering the other viable options that are available to you. If you are confused about anything seek professional guidance.