I think that it definitely was wise of you to get an insurance policy. Sounds like you are planning for the "just in case" in life. If your children are young, you may want to appoint an executor to your estate in your will. You can name your husband, or if in the case he predeceases you, some trustworthy, informed third party - like a lawyer or preferably someone with no vested interest.
Then you can set up a trust for the kids and designate the trust and your husband as the beneficiaries of the life insurance policy. That way you can hold back those funds until they are older (at some specified age), or designate that a certain portion of the proceeds are used to pay off your mortgage, etc. depending on your preferences.
Talk to a lawyer about your will and an estate planner. Don't worry if you don't think you have enough assets for an estate planner. There are all levels of advice. Even some asset managers, like Vanguard and Fidelity, also provide estate planning advice.
Lastly, I don't think you should favor your biological son over the other kids if you love them equally, it would just create tension between them in the end.
2007-06-29 07:09:07
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answer #1
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answered by PK 5
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In this specific instance, the most prudent thing to do would be to have a will prepared with a "pour over trust." In many states, money payable from life insurance to a trust such as this is exempt from creditors. If your husband and you both die then the trust becomes operative. Appoint a bank trust department or a trust company to be contingent executor and trustee and that bank will guarantee that your wishes will be fulfilled to the letter and no one can raid the money. In fact, if you are both dead, you can set the life insurance up to pay only for the benefit of the children and the mortgage company can have the house and so forth.
Finally, you should never name children as beneficiaries directly. Having been an insurance agent, I can tell you the problems. First, they cannot sign a check legally so the company can only issue it after people have gone to court to get court supervision, even your husband won't be able to get to it. Second, if you both die, it is almost certain that the court will appoint his ex as the trustee for their four children and that it will be totally unsupervised. In the jurisdiction I am in, it is presumed that a parent trustee knows what is best and will not be required to account for any money spent, need to post bond, nor ever be held accountable for use of funds. If she felt that a trip to Jamaica would benefit her piece of mind so when she got back she would be a better parent, that would never be questioned here.
Of course it matters what jurisdiction you live in, but a will with a trust is very inexpensive, probably around $100.
2007-06-29 08:24:38
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answer #2
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answered by OPM 7
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I think you've made a great decision. From what I understand of life insurance beneficiaries and probate proceedings, you don't need to worry about your husband's ex-wife because she won't get any of the money. If both you and your husband die, then the children will each get their 10 percent and your husband's 50% will go to his estate. As long as he has a will that gives his entire estate to the children, the ex-wife won't see any of it. The court will set up someone to oversee the children's money until they turn 18. If you know someone you would like to be that person, you can specify that in the will.
That being said, I am not an attorney or anything. If you really want peace of mind, you go to an attorney to write your wills, etc. It shouldn't cost more than a few hundred dollars which is a small price to pay for the well-being of your loved ones once you pass on from this life.
2007-06-29 07:04:10
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answer #3
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answered by Jade C 3
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Just a heads up, one of the answers I read thus far stated that if you and you husband die at the same time his share will go to his estate. This is not true, The Simultaneous Death Clause that is standard Thur out most of the united States states that a beneficiary must out live the insured by 15 days or the proceeds to be paid to the Beneficiaries estate, if you die at the same time the proceeds payable to that Benificiary will be paid to the others.
The real question Did you do good? Yes I think you did. I am a step Parent myself, I have a policy that my wie is primary and my 3 kids recieve the proceeds in trust accessable in instalment payments til 21, an allowance for school expences that is exepmt from the standard rules of the trust, And trustee as the gardian of my 2 biological children, They are also named as gardian in mine and my wifes will.(something I highly recomend).
2007-07-03 03:22:48
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answer #4
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answered by Anonymous
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It is always difficult to decide beneficiaries with life insurance.
I use primary and secondary beneficiaries.
My spouse gets the majority, because she has the kids to raise. I have another close relative, such as a sister, brother or aunt also as a beneficiary. The children get hardly anything.
My logic is that the small children will not be able to use the money, but those who care for them will need it to bring them up.
There is also the unthinkable, a bad car wreck with everyone in the car. This way my sister and will have enough to cover our funerals, in case we all bite the bullet.
I would do something like this:
Primary Beneficiaries
75% Spouse
10% Sister
10% Brother
1% for each child.
This way if you and your spouse are both in a terrible accident and don't survive, your brother and/or sister will have most of the money to cover your funeral and support the children.
If the children are in the same tragedy with you and your spouse, your brother and sister will be able to take care of the funeral and/or other expenses.
2007-06-29 07:15:49
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answer #5
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answered by Feeling Mutual 7
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I might suggest you to visit this website where you can get rates from different companies: http://QUOTES-FOR-INSURANCE.NET/index.html?src=2YAumd82adyA
RE :Life insurance?
I have five children. My husband and I had one and he and his ex had four; they all live with us. I have always thought of these children as my own because their mother floats in and out of their life. I recently purchased a life insurance policy on myself and have listed my spouse and my children as the beneficiaries, my husband getting 50% to pay off the mortgage and debts and then each child gets 10%. But I am wondering if I've made a good decision. I worry if something unfortunate did happen to both my husband and I that the kids mother would just blow all the money. I got this policy for peace of mind to make sure that they wouldn't have to worry about the mortgage and college and all those things but should I leave more for my biological son then my step children? I don't like to think of them separately as I said, they are all my children. I just want to do what's right by them. Please don't be rude or a smart ***... I really just would like to hear other peoples opinions.
Follow 9 answers
2016-09-10 21:58:52
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answer #6
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answered by Rickert 6
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Another suggestion to the other good answers is to have (along with a will etc.) the childrens money go into an irrevocable trust until their 18 or any age you choose. You can also decide to let the kids have their money at different times in their life or meet certain criteria to get the money. For example for every dollar they earn on a 1040, the get a dollar fom the trust. A laywer can help set all that up for you.
2007-06-29 07:44:14
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answer #7
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answered by B . 2
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Term insurance -where insurance is purchased for a specified period (typically a year, or for level periods such as 5, 10, 15, 20 even 25 and 30 years) where a death benefit is only paid to the beneficiary if the insured dies during the specified period. on survival nothing is payable Permanent life insurance is a form of life insurance such as whole life or endowment, where the policy is for the life of the insured, the payout is assured at the end of the policy (assuming the policy is kept current) and the policy accrues cash value.
2016-05-18 23:01:46
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answer #8
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answered by ? 3
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you can place the money in a trust for your kids. whom ever you leave in charge of the trust for your kids will alocate the funds according to your wishes. "A trustee"
I am a licensed insurance agent. A company that I represent has an orphan benefit. Each child would receive $300 per month if both guardians are deceased and $150 per month if one guardian is deceased until the children reach 18. After 18 each child would receive 6000 per year for four years for college.
Talk to your agent or your insurance provider directly, or use a prepaid legal service to write you up a will. Sometimes money after a death destroys families when you would think a good life insurance policy would protect them.. Good luck
2007-06-29 17:47:07
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answer #9
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answered by Patrick 3
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i think the decision you made is exactly right, because YOU made it. if you consider them all to be equal, spreading the percentage equally is perfect, if you hold your son in a higher regard for biological reasons and feel he deserves more, change the beneficiary information. like you said, this is to their benefit and is for you to have the peace of mind of knowing you have set up something to help should the worst happen.
2007-06-29 07:11:39
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answer #10
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answered by Anonymous
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