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Other Uses For Life Insurance

Many people are familiar with life insurance in the traditional sense, which centers around replacing a source of wealth or income lost due to death. For many families, though, life insurance can serve a variety of basic needs, including playing a role in estate planning.

Life insurance offers many benefits that can help meet a family's financial goals. For instance, it can provide instant money that the family can use to pay living expenses, debts, bills associated with final illness, burial expenses and costs of estate administration. It can also serve to cover the cost of federal or state estate and inheritance taxes, if such a liability exists. This benefit can be extremely important, because without such a source of money, one's family might be forced to sell certain assets to generate needed cash. They could also face dramatic changes in lifestyle, even bankruptcy, without additional liquidity to cover ongoing expenses.

If you own a business, life insurance proceeds may allow your surviving partner to buy your interest in the partnership or corporation, which would enable the business to continue as an on-going enterprise. These proceeds could also be the key to allowing an heir to buy a family member's farm/ranch or other business at his/her death and keep it in the family.

All in all, life insurance can be a powerful financial tool like no other. Not only can it be used to provide liquidity to cover liabilities of a decedent, it can also play a significant role for business owners. What's more, life insurance can act to replace income for someone who might be dependent on you, such as a spouse or other family member.

For more information about how life insurance can play a role in your financial plan, contact us today or speak with your Alliance America Agent.