If you are like most folks, you think that once you buy a life insurance policy, you can file it and fuhgeddaboudit! I encourage you … nope, I beg you not to make this critical mistake. Reviewing your life insurance policy is an integral part to your financial security planning.
The primary reason to examine your policy is to save you money, and perhaps arguably less important is to make sure that your beneficiaries are listed correctly. I have seen everything from deceased parents, ex-spouses and specific children named while excluding later born children.
When I explain to clients that life insurance beneficiaries supersede directions in their will or revocable trusts, it is like a deer in headlights! Whom you name as beneficiaries on your life insurance contract trumps what your will says.
This fact alone repeatedly creates havoc when settling an estate, which is why a periodic review is not only necessary but also quite easy assuming that you know an advisor who cares to take the time to prepare an “inforce illustration” that will summarize the following:
· Type of policy (group versus individual, term, whole life, universal life or variable life)
· Amount of your coverage
· Annual premium
· Policy benefits, features or riders
· Beneficiary structure
· Policy fees
· Policy performance
Based on the inforce illustration data, your advisor should provide you with his or her thoughts and recommendations. To get the ball rolling, all that you need to do is provide a copy of your most current life insurance policy statement to your financial advisor. That is it!
The turnaround time to get you a copy of the analysis is about 10 to 14 days. Lastly, most of us know what we should do, but knowing is not enough! We must take action! Confucius never said that, but he definitely was thinking it!
Harry Pappas Jr. CFP®
Managing Director-Investments
Master of Science Degree Personal Financial Planning
Certified Estate & Trust Specialist ™
Certified Divorce Financial Analyst™
Pappas Wealth Management Group of Wells Fargo Advisors
818 North Highway A1A, Ste 200
Ponte Vedra, Florida 32082
904-273-7955
harry.pappas@wellsfargoadvisors.com
The use of the CDFA™ designation does not permit Wells Fargo Advisors or its Financial Advisors to provide legal advice, nor is it meant to imply that the firm or its associates are acting as experts in this field.
Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC, Member SIPC, a Registered Broker-Dealer and a non-bank affiliate of Wells Fargo & Company.
The opinions expressed in this report are those of the author(s) and are subject to change. The material has been prepared or is distributed solely for information purposes and is not a solicitation or an offer to buy any security or instrument or to participate in any trading strategy.
