Hey how's it going everyone my name is derek ifasi i'm the owner of a Fosse Financial Group today's topic I want to discuss with you life insurance beneficiaries and kind of what a life insurance beneficiary has to be mindful of when that when that incident does unfortunately occur now what happens is an individual has life insurance coverage on themselves for either a set term duration of time kind of think of it like an umbrella for set duration of years maybe that's a thirty year term policy now during that timeframe let's say this person is $500,000 of life insurance coverage on themselves and they were to pass away at year ten if that does occur then $500,000 is going to be a paid to their life to the beneficiaries that they designated at the time when they originally signed their contract or what the most recent beneficiary forms are filled out for that specific policy now the way with life insurance life insurance works really really neat is because it comes to you guys in a tax-free manner meaning $500,000 is Geetha is going to get paid to you 100% tax-free not like an IRA account or a retirement account that you'd be paying some sort of Taxation there that the you know that the individual did not pay taxes on yet so this is very very important up you're setting up your life insurance beneficiaries that you include the specific you know loved ones in your life you you set it up in a specific charity and you know a big mistake that I see a lot of individuals do is they might set up one primary beneficiary and they never set up something known as a contingent beneficiary meaning the person next in line in case that primary beneficiary passes away before the person that has a life insurance coverage on them so you might see something like you know husband and wife have life insurance on each other they just designate each other as the primary beneficiaries and you know God forbid both of them would pass away in an accident rather than getting all that tax-free in common and and basically leveraging the benefits of life insurance to the children if these two parents had it set up with the children as contingent beneficiaries they would be able to take it in a tax-free would not have to go through probate and it'll be a much simpler process as opposed to when you don't have a contingent beneficiary it would go to the individual that that passed away if they don't have any beneficiaries then it would go directly to their estate and then you'd have to go through probate and that's a huge huge headache now individuals that are receiving these proceeds you know they have some duration of time that they have to essentially contact the life insurance carrier and show them a death certificate of the individual that did pass away so that they can collect their $500,000 this is one of the things that we do we take very very seriously when setting up a life insurance contract is to make sure everything is is set up properly meaning from from soup to...
