Who Needs Whole Life Insurance?
While there is a lot of advice against purchasing a whole life insurance policy, there is a benefit to those who purchase these policies for estate planning purposes. If you have a large estate, it’s subject to taxation by the federal government. In 2009, you’re estate is tax-free up to $3.5 million. After that, 45 cents of every dollar goes to the federal government. Considering homes, retirement accounts, small businesses, death benefits from life insurance, and other assets, it isn’t that hard to have an estate that’s valued at more than $3.5 million. Furthermore, we don’t know what estate taxes are going to look like in the future. The taxation threshold could be raised or lowered. The taxation percentage could increase or decrease. The best option is to protect your family against high estate taxes, with a whole life insurance policy, for example. Whole Life Insurance and Estate Planning Let’s assume, for example, that you have a $10 million estate. When you pass away, your estate
