A Lifetime Gift for Your Grandchildren

The Cascading Life Insurance Strategy

If you are a grandparent wishing to provide an asset for your grandchildren without compromising your own financial security you may want to consider an estate planning application known as cascading life insurance.

How does the Cascading Life Insurance Strategy work?

• The grandparent would purchase an insurance policy on his or her grandchild and funds the policy to create significant cash value;

• The grandparent would own the policy and name their adult child as contingent owner and primary beneficiary;

• The cost of life insurance is lowest at younger ages, allowing the grandparent to establish a plan that allows the cash value in the policy to grow tax deferred;

• When the grandparent dies his or her adult child becomes the owner of the policy.

What are the benefits of the Cascading Life Insurance Strategy?

• Tax deferred or tax free accumulation of wealth;

• Generational transfer of wealth with no income tax consequences;

• Avoids probate fees;

• Protection against claims of creditors;

• Provides a significant legacy;

• Access the cash value to pay child’s expenses such as education costs. (Withdrawal of cash value may have tax consequences);

• It’s a cost effective way for grandparents to provide a significant legacy.

Please call me if you think your family would benefit from this strategy or use the social sharing buttons below to share this article with a friend or family member you think might find this information of value.