WEBVTT

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Is one of your life goals to
maximize the legacy you leave

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by transferring wealth
tax-efficiently to your family?

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If you have tax-deferred
assets you don't need

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to meet your retirement
income needs,

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then a strategy incorporating
life insurance may be

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the answer.

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Here's how it could work.

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In this scenario, Ben, and
Leslie, are both retired

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and in their early 70s.

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Their retirement income
need is $90,000 a year.

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Between vacation rental
income and a pension,

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they feel they have
enough income.

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They also have investable assets
to supplement their income

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as needed to help
maintain their lifestyle.

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Ben is also taking required
minimum distributions

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from his IRA.

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Since he doesn't need
the distributions

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to meet his income needs,
he is reinvesting them.

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As part of their
legacy planning,

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Ben and Leslie could use the
required minimum distribution

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to purchase a survivorship
life insurance policy -

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one that pays the benefit at
the death of the second spouse -

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naming their children,
Andrew, and April,

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as beneficiaries of the policy.

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After Ben and Leslie
are both deceased,

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they plan to leave the remaining
IRA to their grandson, Tom,

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who is in a lower tax
bracket than his mother April.

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By doing this, their children
will receive the proceeds

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from the life insurance
policy income-tax free,

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and Tom will inherit the IRA
as a non-spousal beneficiary.

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This strategy could help Ben

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and Leslie utilize
generation skipping

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and immediately leave a
legacy to two generations.

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Incorporating life insurance
can potentially serve as a hedge

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against volatility
or dying too soon.

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A similar strategy may be
implemented with annuities

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that aren't needed
for retirement income.

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Additionally, If Ben and
Leslie are charitably inclined,

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they could leave the remaining
IRA balance to a charity,

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or a donor advised fund and
make both their children

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and grandchild beneficiaries
of the life insurance.

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Finally, if they have a
taxable estate, they may want

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to establish an Irrevocable
Life Insurance Trust

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to own the life insurance,

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so the death benefit
is estate tax-free

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as well as income tax-free.

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For help finding a legacy
maximization strategy

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that is right for you, talk
to your financial advisor.