Article written by Jennifer Black and Dedicated Financial Solutions.
Legacy Bond
First thing to note is that a legacy bond is only one of many different and similar options involving insurance and investments. There are other options that could be right for your situation and may also be better.
A Legacy Bond is a good idea to consider if you meet the following criteria.
– You know you have enough income to live your life comfortably.
– You have beneficiaries (children, charities, or others) to whom you want to leave money on your death.
– You know there will be money left over that will pass to your beneficiaries.
– You are in good health. You can be any age but the younger you are the more favorable rates you will get.
Here is an example of a client we were able to secure a Legacy Bond for:
Benjamin switched over his investment in 2006. He was interested in keeping a portion of his investments with the specific planning focus of passing them on to his children and grandchildren. Ben wanted to leave $100,000 to each of his 3 children and their families. Benjamin was 64 at the time. Fast forward to 2012, Ben is now 70. Still interested in leaving a legacy for his beneficiaries but worried that he was going to spend too much of his investments Ben was looking for another option that would provide some guarantees to his legacy. his main concern was that the amount he wanted to leave to his children would have to be used to fund his retirement or that there would be too much estate tax on his death and it would significantly reduce the amount that his children were to receive.
We were able to show Ben how he could take a portion of that money over the next 8 years putting in $25,178 per year. This means that over the total of 8 years he will have deposited a total of $201,424 into the legacy bond providing him with a guaranteed payout directly to his children of $300,000. This money will also go to his beneficiaries tax free therefore actually increasing the amount his beneficiaries will receive.
To find out more about whether or not a Legacy Bond is a good option for you contact us today for a complimentary assessment.
