Protecting your heirs through insurance


January 08, 1995|By SUSAN BONDY | SUSAN BONDY,Creators Syndicate

Q: I am interested in buying a second-to-die insurance policy to cover estate taxes. Do you have any information on this subject?

A: Second-to-die life insurance makes sense for high net-worth individuals who want to protect their heirs' estate against inheritance taxes.

As most people know, a husband and wife can transfer properties to each other upon death with no tax consequences. However, when the second spouse leaves this world, the estate can be hit hard with taxes. A second-to-die policy can relieve some of that pressure. And because this policy covers two lives -- extending the term of the policy and the length of time premiums are paid -- these premiums tend to be lower than single-life policies.

I know of two organizations that offer low-load second-to-die policies:

1) Veritas (800) 552-3553: Veritas' main advantage is its wide array of products from the highly rated Ameritas Insurance company.

2) WIN (800) 808-5810: Wholesale Insurance Network's main advantage is the ability to shop around and offer the lowest cost insurance from its stable of companies.

Q: I am 84 and want to buy some Series EE bonds. What is the best way to register them?

A: A bond may be registered in one of three ways:

* One owner only: Upon death, the bond becomes part of the owner's estate.

* Two co-owners: Either may cash the bond. On the death of one owner, the other becomes sole owner.

* One owner and one beneficiary: The beneficiary becomes

owner when the original owner dies.

Susan Bondy founded her namesake financial services company 1980 to provide financial planning and asset management. She is a frequent guest on "Good Morning America," the "Today Show" and National Public Radio. She is the author of "How to Make Money Using Other People's Money." Write to Susan Bondy in care of The Sun, 501 N. Calvert St., Baltimore, Md. 21278. All letters will be treated confidentially.

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