Aventura News Apr.29-May.5 2009
by Keith Owen

The estate tax is currently scheduled to be repealed in 2010 (i.e., zero tax). However, President Obama’s new budget calls for estates valued over $3.5M ($7M for married couples) to be taxed at a rate of 45% next year and beyond. Given that these are also the current 2009 levels, the new administration argues that there is no estate tax increase. Which view do you take on this? (A) The proposed estate tax is not an increase because it mirrors 2009; or, (B) The proposed estate tax is vastly greater than the scheduled repeal of the estate tax in 2010. Some argue that this proposal signifies the largest estate tax increase in U.S. history. In all fairness, the current proposal is more favorable to consumers after 2010.

An increasingly popular estate planning tool that many people are still unaware of is premium financing for life insurance. Those that may qualify for premium financing for life insurance are individuals between the ages of 70 and 85 with a net worth of at least $1 million.

4 Key Reasons to Consider Premium Financing:

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Aventura News Dec.31-Jan.6
by Lynn Carroll

Looking for a way to balance your financial situation in the current economic environment?  “Consider life insurance premium financing,” says Jon Kidd, CEO of Banyan Life Financial.

The ideal client for this option, he says, is 70-plus years old, preferably with a minimum net worth of $1 million.

“Simply put, life insurance premium financing marries a life insurance policy to a loan. Life insurance can be purchased inside an Irrevocable Life Insurance Trust and paid for by a premium loan.  The insured clients are merely leveraging a hidden asset we call insurable capacity,”  Kidd explains.

“Despite the current credit crisis in the global markets, institutional lenders are increasingly deploying capital for life insurance financing as it is considered to be a long-term stable asset-class.”

Kidd comments, “Institutional banks and insurance carriers let clients use the policy as primary collateral as they understand that it is an asset with more value than the loan itself.  Loans against these policies yield competitive rates and terms. The interest can be accrued into the loan whereby you may even have the option not to make payments.”

The policies can significantly minimize inheritance tax obligations, making them ideal for older persons looking to pass on their assets.

“In the present financial climate,” Kidd explains, “a lot of people have lost between 20%-30% of their net worth. There may be no better way to balance out the situation than through premium financing.  Life insurance is known by many to be the number one means of augmenting wealth transfer from generation to generation.”

It is important for clients to understand that there is full transparency and approval for these products at the insurance carrier and regulatory levels.  Most CPA’s or attorneys who understand and review this transaction for a client will sign off on it.

Kidd remarks, “In cases where clients no longer need or want the life insurance, they can consider selling the policy, as it is just like any other personal asset. It is also a great way to enhance planned giving by donating your insurability to a charity or alma mater.”

For more information call Banyan Life Financial via (305) 695-8052, toll-free via 800-828-ESTATE (3782) or visit online at www.BanyanLife.com.