Life insurance is something that should be a part of your estate plan. While you may think about it as only a way to provide for your loved ones, it is actually quite versatile. You can use life insurance in many ways within your Illinois estate plan. This means it is beneficial even if you do not have any heirs.
Kiplinger explains you can use life insurance in a few ways other than leaving it directly to your family. If you have an unconventional family, such as friends you treat like family and who you help out from time to time, then you can use your policy to provide for them after your death. The recipient of your policy payout does not have to be someone related to you.
Beyond just providing for someone else, you can also set it up in your estate plan to use the policy to pay off your debts. This is an excellent idea if you have a large amount of debt that you worry about leaving for your heirs. For example, if you have a lien on an asset, you can use your life insurance to pay that off so that your heirs can have the asset free and clear.
Another option is to use it to pay for your final expenses. This can be costly, so covering these expenses relieves a significant financial burden for your family.
It is essential to decide what you want to do with your policy now so that you can set up your estate plan with your wishes. This information is for education and is not legal advice.