Estate planning is more than just minimizing the impact of estate and gift taxes;1 it includes setting your goals and defining your legacy for the future. Ultimately, estate planning is about family. If you are concerned about your loved ones, you need to take action to lessen the financial burden of your incapacity or death.

Where Do I Start?

Some important steps in planning your estate are: 1) determining who should make decisions for you in the event of your incapacity; and 2) what you want to happen to your loved ones and your assets after you have passed away.

Some Questions to Ask Yourself:

  • Who should make health care decisions for me?
  • Who should manage my assets and take care of me in the event of my incapacity?
  • Who should carry out my estate plan after my death?
  • Who should take care of my children if they are minors at my death?
  • Who should receive my assets at my death?
  • How should my assets be distributed at my death?

Why May I Need Life Insurance in My Estate Plan?

Life insurance insures your life. So, when you die, the death benefit is paid to your policy's beneficiary. Life insurance death benefit proceeds can provide the liquidity your estate may need to help complete your wishes.

  • Maintain your family's lifestyle – Life insurance death benefit proceeds may provide the funds necessary to help replace your lost income and settle any outstanding debts.
  • Balance an inheritance – Designate an amount in cash (from the death benefit proceeds) to treat another heir fairly/equitably.
  • Plan with a blended family – Life insurance can help you provide for your children from a prior marriage even if you leave your other assets to your current spouse.
  • Pay estate settlement costs – Life insurance can be used to provide the necessary liquidity to pay estate settlement expenses (like administrative costs, and estate taxes1) without liquidating your precious family heirlooms. Your estate might have assets and family heirlooms that heirs may not wish to sell to pay expenses or that are not easily sold. That may include the family home, farm, land, artwork, collectibles, and more.
  • Help with business owner’s unique needs -  Life insurance death benefit proceeds can be used to: 1) help your key employee buy the business from your spouse. That way the business can continue and your spouse has assets to live on or, 2) pass your business to your heirs by giving them the working capital to keep the business running through the transition.

These are just a few examples of how life insurance can help address your estate planning needs. Work with your life insurance producer and other financial advisors to determine your estate planning needs.

Life insurance is subject to underwriting and approval of the application and will incur monthly policy charges. Life insurance generally requires additional premium payments after the initial premium. If either no premiums are paid, or subsequent premiums are insufficient to continue coverage, it is possible that coverage will expire.

1 According to the Tax Cuts and Jobs Act of 2017, the federal estate, gift and generation skipping transfer (GST) tax exemption amounts are all $10,000,000 per person (indexed for inflation effective for tax years after 2011); the maximum estate, gift and GST tax rates are 40%.  In 2026, the federal estate, gift and generation-skipping transfer (GST) tax exemption amounts are scheduled to revert to $5,000,000 per person (indexed for inflation for tax years after 2011). Currently, 15 states have estate and/or inheritance taxes, some of which have rates as high as 20%. Source: U.S. Census Bureau; state statutes; Family Business Coalition at, Dec. 2017.

This material is not intended to be used, nor can it be used by any taxpayer, for the purpose of avoiding U.S. federal, state or local tax penalties. This material is written to support the promotion or marketing of the transaction(s) or matter(s) addressed by this material. Pacific Life, its affiliates, their distributors, and respective representatives do not provide tax, accounting, or legal advice. Any taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor or attorney.

Pacific Life is a product provider. It is not a fiduciary and therefore does not give advice or make recommendations regarding insurance or investment products. 

Pacific Life refers to Pacific Life Insurance Company and its affiliates. including Pacific Life & Annuity Company. Insurance products are issued by Pacific Life Insurance Company in all states except New York and in New York by Pacific Life & Annuity Company. Product availability and features may vary by state. Each insurance company is solely responsible for the financial obligations accruing under the products it issues. Insurance products and their guarantees, including optional benefits and any crediting rates, are backed by the financial strength and claims-paying ability of the issuing insurance company. Look to the strength of the life insurance company with regard to such guarantees as these guarantees are not backed by the broker-dealer, insurance agency or their affiliates from which products are purchased. Neither these entities nor their representatives make any representation or assurance regarding the claims­paying ability of the life insurance company. 

Pacific Life's Home Office is located in Newport Beach, CA.


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