What is a Waterfall Concept?
The waterfall concept involves the creation of a life insurance strategy that will prove to be beneficial to more than one generation in the family. Essentially, the waterfall concept calls for the engagement of a life insurance plan that will roll over from parent to child. In addition to providing coverage for the younger generation, the waterfall concept can also allow the creation of a tax benefit. This particular financial strategy is named for the action that is associated with a waterfall. Because waterfalls involve a point of origin that is followed by the water trickling down to another level, the idea helps to illustrate how a waterfall concept works. Since the concept begins with one generation arranging for life insurance that will over time trickle down to a succeeding generation, insurance that is rolled over functions much like the waterfall, in that the benefit goes from the source to related areas. Creating a waterfall concept is not that difficult. The process begins
