Can Life Insurance Benefits be given to Charity?

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Many people who receive life insurance benefits use the money to pay off mortgages, credit cards and other types of debt.  Others use it to buy a home, a car or some other type of purchase.  And then there are those who prefer to donate the funds to charity.  Is it possible for this to happen?  If you leave an inheritance behind through life insurance, can a beneficiary choose to give it away?

According to most life insurance policies, it is possible for beneficiaries to use money inherited through a life insurance policy in any way that they see fit.  If you prefer for the money to be used in a certain way, you’ll need to open a trust or savings for your loved one and legally designate its use before you become deceased.

On the other side of the fence, if you are looking for a way to make a charitable donation, life insurance proves to be a cost-effective solution.  Take for example that you pay $5,000 a year for 15 years for a whole life policy in the amount of $200,000.  You would have a total of $75,000 invested in a $200,000 payout to a charity of your choice.  Of course the amount you have invested is ultimately determined by how many years you pay the premiums before the policyholder becomes deceased.

As you can imagine, policy options are vast, making it all the more important that you speak with one of our reputable insurance agents serving Little Falls, MN.  Our agents can speak with you about your options and help you find a policy that best meets your charitable donation preferences.