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Counting the Cost of Your Death: How does it affect your family?

Finishing Well / Hans Scheil
The Truth Network Radio
August 11, 2018 8:30 am

Counting the Cost of Your Death: How does it affect your family?

Finishing Well / Hans Scheil

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August 11, 2018 8:30 am

You might be in a different season of your life, you are not completely financially supporting your children and family anymore, but there is still an immediate need for money at your passing. Hans explains why $25,000 is the  minimum amount he recommends to cover these immediate costs. While you have a Will to dictate how your assets are going to be split, the life insurance comes in to pay the bills while your family is working all of this out.

 

Hans even tells the story of his sister who passed 7 years ago. Even though her brother and father both sold life insurance, she did not have a  policy when she died. Her husband has told Hans many times that while two incomes is great, one income is very different.

 

Don’t forget to get your copy of “The Complete Cardinal Guide to Planning for and Living in Retirement” on Amazon or on CardinalGuide.com for free!

 

You can contact Hans and Cardinal by emailing hans@cardinalguide.com or calling 919-535-8261. Learn more at CardinalGuide.com.

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Welcome to finishing well brought you by Cardinal Drive, certified financial planner belongs at Shiloh best-selling author and financial planners helping families finish well for over 40 years of finishing well will examine both biblical and practical knowledge to assist families in finishing well, including discussions on managing Medicare IRA long-term care life insurance and investments and taxes. Now let's get started.

Finishing well today on finishing well this makes racing like a morbid subject track with me that I don't know Jesus when he was actually talking about being the cost of being a disciple. He made an interesting point in Luke 14 where he said who would begin to build a tower not count the cost to make sure that they would finish well name is show finishing well.

The way that we are finishing our life here on earth is Jesus doesn't come as were actually and so it's an interesting thing to actually look at counting the cost of your own death from a standpoint of the effect on your family and course none of the strategy after you have an experience with that. Personally the beauty of having Hansel is here today on finishing well with Cardinal guy.com is that he's had a lot of experience in helping us count the cost of what that might look like and how to finish well under the circumstances right on. We have, and I think too many people have let dependence define life insurance as it relates to your estate in just as it relates to buying it and purchasing it in and I think that hurts us swing a couple different things along those lines of counting the cost of of ways to provide for the cost of that one being life insurance of the other way being estate planning, but diving into the first part of that life insurance itself will before we get there. What is the cost to me what what are some of the cost of if I die. What would my family be looking at what I recommend in my workbook in my book is a minimum of $25,000 of permanent insurance for person more talking people here that are 5060 7080 that you know are going to pass at some point here in the future then on whether you lived in their 90s their 80s or whether there to meet their demise sooner than that.

So we talk about life insurance in filling the gap with because life insurance is just one of the ways you can create this $25,000, but this is really prime talking minimums here. I'm talking about with the amount that people should have at a minimum so and what were talking of the need for that. Were talking about $10,000 for a funeral and burial K and homages you go down to the funeral home. If you had this experience with a loved one.

They want money or they want credit card or they they need money and adjusted cost money to and and and it is probably the worst possible time for the survivors I know was for me. When my father and my mother passed had a little planned a little bit better for my mother but just to go sit with those people and start looking at all the expense they have $10,000 needs. You need that much liquidity then were going to talk about another couple thousand dollars to pay an attorney because you use get immediate expenses if you're gonna actually if somebody can access your assets after you pass when your family members there and I need to use an attorney to set up an estate and settle an estate couple thousand dollars probate the will probate the will images and were talking that that that that's at a minimum amount that's for a small remote standard estate. If you've got a larger state even need substantially more than that to pay the attorneys and you probably want to get a relationship with them.

Will your life and incur a lot of those cost to get things set up properly, that maybe it will just cost you $2000 than there just finishing the work in the distributing the money and selling the asset second so couple of thousand dollars. There were gonna throw in $1000 at a minimum to pay an executor you really need to pay a person or whether this is when your children have a best friend whoever's going to be the person that is named as the executor you need to pay them a minimum of the thousand dollars just they incur some liability to get by some insurance so now we got thousand dollars for that and what I've thrown in. In my book and I talk about is another $12,000 of income replacement and you say why do I need income for replacement. I mean after I passed. Where will your incomes can stop if you have any pensions Social Security.

It can stop in the bills for your stuff Taxes keep coming in. So if this is one your children if you're not married you're not. You don't have a spouse and you know even if you do have a spouse's second one of you is gonna die at some point without a spouse, they're gonna need the so security stops you're still you need to pay the water bill and the light bill and any expenses and you want your bills paid and you want to keep up the property for a period of time. So I say $12,000, which is 2000 a month for six months or 2000 a month for 12 months.

Just some income replacement if you got a spouse unity a lot more than that, but certainly that would be more helpful than having nothing so yeah and all that up. It adds up to $25,000 and a likely term that that this is right when you need it kind. It's an explosion of money that will that's what life insurance doesn't.

And most people their familiarity with life insurance that are you around your age. My age there thinking term insurance there thinking 1/4 of a million 1/2 a million, $1 million hundred thousand there just thinking and that truly is an explosion of money exactly when it's needed. Folks think in terms of that of larger amounts and hope and plan to live and not have that happen to them with her. Gonna die at a young age and term insurance feels a nice void for that. What I'm talking about here is $25,000 it's going to show up at a minimum, immediately when you pass away. It can be money that's available right in and so you're at the point where you're not supporting kids in the board meeting them to go to college and all that but it's eager to different season of your life. But there still are to be immediate needs for the people are dealing with your actual task with you and then you need to have things set up for your alive and need to have a will and in your will, you need to state who gets what K what you can give to the church summit. You can give your kids how much you can pass to your spouse or your brothers and sisters some charitable organization that you immediately you need to state this all for your stuff and a lot of folks will use that as a reason not to have life insurance and they'll say what I've got money in the bank and I got an IRA and I've got these things I meant land and that they'll just bury me out of that and divide up what's left it. It isn't that simple meaning. The six so you need to have a will and you need to have all that stated as to who gets what. That's what you pay the attorney for is to probate that will you pay the executor or the executor is usually somebody close with you to just administer according to your wishes prior to life insurance comes in play to create immediate money will your work and all that stuff out and if you're just tuning in your one and one will not listen to this is finishing well with certified financial planner Hans Schild is brought to you by Cardinal guide Cardinal guide.com as from his book the complete Cardinal guide to planning for living in retirement.

He got the book and you got the workbook and talk about today, life insurance and estate planning. And you know you may think I want to hear me but life insurance or some list, not because we got some stuff about estate planning that I think might blow your way when you start talking about counting the cost.

And so that's one of the seven worries@cardinalguide.com at tab you can get a PDF of the entire chapter workbook right there. Both chapters mean so you can go to our website Cardinal guide.com and we've taken both of these books broken down into the chapters so today's chapter would be under life insurance and there is Chapter on that from the original book and then there's a chapter in the workbook that will spell out all this stuff that I'm talking about and you can get that for free just downloaded.

You could actually put the whole book together on our website just by downloading all of it, or you can go to Amazon.com.

It's done quite well on Amazon and you can buy it on the Kindle for as little as a dollar 99. You can buy the whole book in paper format and will ship it to you for 799 so how are you always make this offer, the people can call you and you just get even give us a call even messages on the website. I'll be glad to send you a copy of the project because the idea is to get the information in your hands because it's all it really is about finishing well and you were talking today about counting the cost of my actual date of death when I pass on hopefully to be with Jesus.

I hope that is what's happening with you too and that's really happy for us but the people that are kinda left have now got some real things that they got a face American to be facing them immediately and and how if you plan for that so that you can in fact finish well and and bit of when it comes this life insurance is a different kind of life insurance but I like that in some people's cases that have money, you know they can do recall the whole premium you know we can do single premium whole life right so we can work the list backwards. Were you in my book. I give examples of the 55-year-old and a 70-year-old female in you know it it it. 55.

You can take $10,000 and just pay a single premium and have about $25,000 for the life insurance you never have to pay any premiums on skin pay $25,000 to your beneficiaries.

If you need more than that if you needed 100,000 you could take $40,000 in that would turn into 100,000 at age 70. That number is $15,000 plus a little bit will be a paid up $25,000 policy and there's a huge benefit tax wise, rather than you say. Why would just give the money to my well if they got the money in your state. This can be taxed. I think it is life insurance hasn't come yet it's tax-free and it's the real thing is it avoids probate it's immediate you have a beneficiary on life insurance you can name your kid or your executor or wherever you look after your affairs and have a check from that life insurance company long before this estate even gets opened up and so there's this explosion of money, but it's an explosion of money tax-free and but the point is, there's a lot of ways to plan for that and that's what were talking about today is counting the cost of our own death.

It sounds a little bit morbid, but in a way it's kind of neat to know that wow and when I go my families can have an explosion of money my families to have resources in order to get the vision for their own life and what that's gonna look like we come back I we got a couple stories of people that didn't planning kinda get an idea of what happened as a result of that because there's a lot more than just life insurance services whole idea of estate planning we come back to hear more that again you listen to well with my family financial planner Hans Schild and we hope you are enjoying finishing well brought you by Cardinal guide.com visit Cardinal guide.com for free downloads of previous shows, including episodes about Social Security and Medicare, IRAs, long-term care, life insurance, investments and taxes as well as Hans best-selling book, the complete Cardinal do I do planning for and living in retirement. Plus the accompanying workbook. If you want to follow along with today's topic download free PDF had Cardinal guide.com by going to the seven worries tab of today's show topic, just scroll down to useful documents once again for free resources shows going to get Hans book the complete Cardinal do I do planning for and living in retirement or the workload go to Cardinal guy.com you have a question, comment or suggestion for future shows. Click on finishing well radio show and send us a word. Once again that's Cardinal guide.com Cardinal God.com now finishing well brought by Arnold guide.com welcome back to finishing well certified financial planner Hans Schild today show where counting the cost talked about in Luke 14 of you know how we can finish this tower we been building it's our life and and now get a chance to finish it will actually finish it. As we pass on to Jesus, but counting the cost of our actual death and what that might look like from an estate planning standpoint and Hans you know I think about my own situation as I became a Chrysler dealer in Marksville as the result of the previous Chrysler dealer dying and he died completely. You know, surprisingly, to his daughters. He was, as I recall, in his late 60s he went in for a heart catheterization. He died on the table and he thought that he had set up all his well so that his family would live easily, but unfortunately what he had done actually was taken and bought up property all over Davie County and so the property itself had no income that was attached to it. So here is all this property I thought they got a big inheritance, but what they really inherited was the tax property taxes that would be due on all this property. Consider empty houses all the stuff did not produce income and then he had the dealership which wasn't making much of a profit and he had stocked up all this inventory what he thought was really wonderful inventory that was in the parts department like head bolts for you know 63 charge or whatever he thought the stuff was. But in actuality he didn't have much value, so upon his passing with no life insurance. You know, his daughters ended up in a pourable position of this huge tax burden at an you know I believe if I'm not mistaken that they're working at Walmart at this point in time and he had, literally, he was a millionaire from Davie County standpoint told of multimillionaire probably in and all over the place. You know that it said so what were talking about here is like estate liquidity and that's exactly where I'm going back for a person of average means that you know they need $25,000 worth of estate liquidity, meaning that the money will be available right away and this is a case where were just you tell me about this earlier. This gentleman if he to had even $100,000 were the life insurance or 1/4 of $1 million for the life insurance which probably would have been that difficult to obtain.

You know the right point and then combined with an attorney looking at this whole thing and setting things up. Probably maybe he had an attorney involved with that attorney needed to be working with a financial planner like me that can really just what we do in our businesses were working at just behind the scenes were to the person dad and they were in a sale case in which the saga looks like this land is in producing any income is dealership isn't producing a lot of income.

It's getting to be managed.

It's going to need to be sold off and my senses with him. This wasn't prepared for and hit even if he didn't prepare it well.

If you had the life insurance in place and somebody could step in with a little bit of the quiddity or his family. They could have made it through the problems and sold the land. Robbie had to sell the land that really for the taxes that was. It was sad what happened. I watched that there was a lot of stuff that they really perceived to have a lot of value, but when you actually put it there out on the market. It doesn't fit. His name is of the client that the actually doesn't have any heirs so I don't know that he's gonna be buying any life insurance where he has heirs, but they're not his children or spouse and so he is concerned over the same biblical passage that you had talked about and others about leaving his affairs for the people here on earth. If he died right now. It wouldn't be much different than the situation you describe. He owns land he owns a business which is really is a huge amount of inventory and that he's acquired this inventory by buying out closed hardware stores and over his whole lifetime is 75 years old. He answers Gotland's got that he's got some money and if he were all of a sudden become just pass away.

He's of the sleeve and a mass behind and he wants to leave a good bit of this money to Christian missions okay which is wonderful and what I'm going to help him do is not pass along to master the Christian missions and really pass along a mass to his family day right at a big part of that is finding somebody you know because how can I really I don't have any experience in mind. I sit there and think through all the things in you. You work with so many folks and see what the result is that that experience is invaluable. Having somebody you trust to look at your situation and go. What this what you know what's been happening. Yeah, I mean I know in my book I talk about my own sister so my sister Margot passed away seven years ago had to age 57 of a brain aneurysm didn't see it coming. Happened in minutes. Her husband, her widower, he looked at me at the funeral, and you know he said two incomes are great when income is difficult for me. My sister made more money than he did. She is a nurse practitioner and she was also where I took care of sick babies and elderly people and she was she she was at work and all of us child workers and so she had a life insurance.

Her dad was a 35 year life insurance manner brother was a is now you know it, it's time to say about the same amount of time I tried to sell her life insurance probably very delicately and I didn't push it as hard as I should have been.

She died with no life insurance and he was left with with a real mess in the funeral bills to pay for and replace her income. She had just bought a Mercedes say you know and so he had the payments on that and and then he still hasn't purchased any life insurance for me.

Then I just talked about I and I need to get busy with them just the point is is that people don't plan for the unexpected, and then going unexpected because even the rather expect that's coming and we all know were going to die and we just don't want to deal with it and and so life insurance here and we get some life insurance salesperson went out to my house and you know that could be me and then using all I want do that the others can talk me into a bunch payments and that kind of thing. The life insurance is the solution to the problem but you you really need to acknowledge the problem and do the planning and then the life insurance just becomes something that you purchase so that you create some liquidity right at the time your death yeah and there's no and a nonresident as I'm sure any air would say there's a beauty of getting liquidity that they don't get a hidden one-two punch by the taxes of it right because here comes a life insurance check that is tax-free to me, this is money that they eat you know you not burning them with their actually to be able use it without fear of what the river Repercussions what you and I start with $25,000 because there are so many people that are uninsured out there.

We just what we do is retirement planning and estate planning, and we don't just talk about life insurance per week we look at everything when we're doing this for our new clients and also so I got money in the bank. You know I just I don't need that in the reality is I start with $25,000 is rose at least at that and that's going to be very welcome by your family and very much needed to tell you that most people when they really dig into the subject they buy more and you can buy $100,000 for the life insurance fairly easily at 75 years old or 70 or 68 or 62 a means of the younger you are the less expensive it is.

People think they can't buy life insurance if they got health conditions that's that's just not true. We represent about 100 companies and we were gonna find somebody that can ensure we and and in EE if you want a large amount. It's a great way to leave money to charity community just into leave it to your family and perhaps you can leave them with some assets and some cash to tenant to look after those assets you listing to finishing well today was certified financial planner Hans child and we really talk about finishing here because you know what happens actually after you pass your estate plan.

Those kind of things again.

As we've always mentioned, you know there at the seven worries tablet cargo guide.com you can get a download free of the PDF of these chapters on life insurance and estate planning and no that's available but you know, as I think about that. My own situation. You know how I got kids, I've got a wife in a replacing that income that you know I would be producing in all that it's it it's an interesting challenge and it changes through the seasons of your life and so having somebody that actually has experienced it to sit down with you and go okay we are Robbie old red is a really cool looking old truck out there is a 95 Dodge into you. That's probably worth millions and it is worth millions to me but your family is about a $500 truck and I wonder if there everybody stuff when you when you look at it because I think about Mr. purchase and how he was so proud of those head bolts you know that I know that if you listed all mammals have both are worth hundreds of dollars will they weren't worth 50 some cents. As far as what they were actually worth and and you run into that kind of thing all the time will yeah I need since it's so life insurance is the kind of thing that you can go in there and he just creates liquidity at a person's death. And when I'm thinking about the client I was speaking about earlier that has all this inventories got some land.

He's a single fella done heavy children and what I really met him is already a client of ours. He has his Medicare insurance with us and we really met him over. Talk about long-term care because you can get life insurance and long-term care all mixed in the same policy. So we talked about that on other shows and that's what he's going to end up buying because it's a bigger problem for him if he were to get sick still be here on earth. And now he's paying into an assisted living facility which they're gonna have to be selling his land.

In doing so, working to take care of that for them in, but you can get this all in the same policy where where if it doesn't pay for long-term care than it's gonna pay to your state or your heirs at your death, a death benefit and and therein lies the God is given gifted you with that ability and there's other people out there, but the point still gets to find somebody that you trust to sit down with this in and look at your assets.

Look at your store. Look at your family. There's a lot of pieces to the puzzle when you sent man to do this will sure he really just involves really really acknowledging your own mortality, acknowledging and enjoying how much you love your family and to sit down with those two things and find somebody that you trust. Find find a professional that we work with an attorney as well. It's right in our office and she's wonderful and she the two of us work together to put together a plan for people and then put together documents that are legal that so this is all smooth on your family when you do pass on or you get sick before you pass on that you get everything in place. So while you can see there's a lot more to study here you go to Cardinal guy.com to find out more were finishing well today. I'm finishing well is a fun show today. Thanks, Tom. Thank you. We hope you enjoyed finishing well with you by Cardinal guy.com visit Cardinal guy.com for free downloads of the show previous shows on topics such as Social Security, Medicare and IRAs, long-term care and life insurance, investments and taxes as well as ponds best-selling book, the complete Cardinal guy to planning for and living in retirement and the workbook once again for dozens of free resources past shows what you get.

Hans book go to Cardinal guy.com if you have a question, comment or suggestion for future shows. Click on the finishing well radio show on the website and send us a word. Once again that's Cardinal guy.com Cardinal guy.com


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