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Do you have all your estate planning needs covered?
BY TOM KACIREK

No matter what stage of your dental career you’re in, it’s important to be organized and prepared for the future when it comes to managing and protecting your assets. A comprehensive estate plan provides an inventory of your savings, investments, personal and practice related property and other valuable possessions. It also documents your wishes for the distribution of assets to your heirs and benefactors.

Key considerations for a well-managed estate plan can help preserve your assets, minimize potential tax liability and reduce your exposure to risks that could deplete your savings such as a loss of income if you become disabled from dentistry.

Life and disability insurance are cost-effective risk management solutions for helping guard your financial security.

WHY CONSIDER LIFE INSURANCE?

Immediate funds in the event of your death
Estate planning is complex, and probate laws vary by state. This can make it expensive and time-consuming for your surviving loved ones to access your assets. At the same time, your spouse and/or dependent children or whomever you have designated to manage your estate, will likely need to attend to funeral arrangements, financial and legal matters, property issues, taxes, etc., and the related expenses could be significant. Life insurance proceeds are typically available quickly. These proceeds can be distributed income-tax free depending on state law and the amount of the proceeds and can help provide your beneficiaries with a financial source to help cover expenses.

Financial security and peace of mind
Life insurance can also help provide your loved ones with the financial security they need to maintain their standards of living. Often times, families grieving the loss of a member have the added burden of trying to deal with unexpected financial issues that can’t always be met without personal sacrifice such as depleting retirement savings, selling property or finding alternate arrangements to fund college expenses. Proceeds from a life insurance policy can help substitute for your income or be invested in an effort to bolster your beneficiaries’ long-term financial health.

Shelter assets from estate taxes Depending on state law, if the value of your estate, including life insurance proceeds, exceeds $5,450,000, it could be subject to federal estate taxes. One potential way to avoid federal estate death taxes, avoid probate costs and protect insurance proceeds from creditors is to establish an irrevocable life insurance trust (ILIT) as the owner and beneficiary of your life insurance policy. The ILIT can then distribute the life insurance proceeds per your instructions to your named beneficiaries without being subject to any estate tax.

WHY CONSIDER DISABILITY INSURANCE?

Protect your monthly income
An illness or accident that impacts your ability to practice dentistry can result in significant financial consequences. Disability insurance can help preserve the wealth you’ve built by replacing up to two-thirds of your net income if you experience a disabling injury or illness. Using disability insurance benefits to manage your monthly bills helps guard your personal savings while you are without a salary. Some policies also provide retirement savings benefits, so you can continue your retirement plan contributions while out on disability.

Consider your dental practice costs
If you own a dental practice, office overhead expense coverage can offer an additional layer of protection for your estate. It’s a type of disability insurance designed to reimburse you for office overhead costs incurred to maintain your practice during a period of disability. Monthly benefit payments help cover eligible dental practice costs, including your mortgage or lease, utilities, employee salaries, a replacement dentist and more. In short, it allows your practice to stay up and running for up to 12 to 24 months while you recuperate from an illness or injury — or if necessary, sell your practice.

RISK MANAGEMENT MATTERS!

Effective risk management should be a part of any sound financial plan to protect the value of your estate. Life and disability insurance are affordable ways to minimize risk and protect you and your family’s financial future. Review your estate plan and insurance coverage annually to ensure your financial goals are being met, your beneficiary designations are current and policy limits are adequate to meet your needs.

Great-West Financial®, issuer of the ADA Members Insurance Plans, is committed to helping you make informed financial decisions. This series on estate planning includes:

Why You Need an Estate Plan
Common Mistakes with Estate Planning and Risk Management
Keeping Your Estate Plan Up to Date
Do You Have All Your Estate Planning Needs Covered?

Mr. Kacirek, FSA (fellow of the Society of Actuaries), MAAA (member of the American Academy of Actuaries) is vice president, Specialty Insurance Markets for Great-West Financial, which issues the ADA Members Insurance Plans including life insurance, disability income protection, office overhead expense and supplemental medical.

Kacirek T. Do you have all your estate planning needs covered? Posted online Oct. 30, 2017 at https://success.ada.org/en/practice-management/dental-practice-success/dps-fall-2017/do-you-have-all-your-estate-planning-needs-covered.
AM686607-1218

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Common mistakes with estate planning and risk management
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Keeping your estate plan up to date
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Why you need an estate plan

Dentists: The information on this website is not a contract. Benefits are provided through a Group Policy Nos. (104TLP Term Life, 1105GDH-IPP Disability Income Protection, 1106GDH-OEP Office Overhead Expense Disability, 104GUL Universal Life, 104LTLP Level Term Life, 1117GH-HIP Hospital Indemnity, 1127GH-CIP Critical Illness, and 1107GH-MCP MedCASHSM) filed in the State of Illinois in accordance with and governed by Illinois law, issued to the American Dental Association by Great-West Financial®. The ADA is entitled to receive royalties from the ADA Members Insurance Plans. Coverage is available to all eligible ADA members in all fifty states and U.S. territories under the aforementioned group policy. Each Plan participant will receive a Certificate of Insurance explaining the terms and conditions of the policy. Level Term Life premiums are fixed based on the selected duration of 10 or 20 years. An insured must maintain ADA membership throughout selected term to remain eligible for insurance. Annually Renewable Term Life, Hospital Indemnity, Critical Illness, and MedCASH premiums increase annually based on age. Recommended premiums under the Term Plus® Universal Life plan consist of the cost of insurance (which may vary based on the member’s age and coverage amount), the amount chosen by the member for deposit into his/her Policy Value Account and a service charge. Premium deposits may fluctuate or remain level depending upon the amount maintained in the Policy Value Account. Disability Income Protection premiums increase every 5 years and Office Overhead Expense every 10 years based on age. Premium credit for Annually Renewable Term Life and Term Plus Universal Life is not guaranteed but reevaluated annually. Premium credit for Disability Income Protection, Office Overhead Expense, Hospital Indemnity, Critical Illness, and MedCASH is not guaranteed but reevaluated semi-annually.


Dental Students: The information on this website is not a contract. Student coverage is issued regardless of your condition if you are under 45. If you are 45 or older, you can apply for the no-cost coverage and all student program features by providing proof of good health. Coverage renews automatically each academic year. Individuals may convert coverage to the plans for practicing dentists after graduation by paying ADA member premiums and maintaining ADA membership. Benefits are not payable, as defined by the respective policy, for death or disability resulting from a sickness, disorder, physical condition, or symptom that existed or was treated within 12 months prior to enrollment. Benefits are provided through a group policy Nos. (104TLP Term Life and 1108GDH-SDP Student Disability) filed in the State of Illinois in accordance with and governed by Illinois law, issued to the American Dental Association by Great-West Financial®. Coverage is available to eligible ADA members in all fifty states and US territories under the aforementioned group policy. Each insured will receive a certificate of insurance explaining the terms and conditions of the policy.


ADA® is a registered trademark of the American Dental Association and Great-West Financial® is a registered trademark of GWL&A.


Effective June 1, 2019, Protective Life Insurance Company (for policies issued outside New York) and Protective Life and Annuity Insurance Company (for policies issued in New York) assumed administrative responsibilities for ADA Members Insurance Plans issued by Great-West Life & Annuity Insurance Company.


Great-West Financial® is a marketing name of Great-West Life & Annuity Insurance Company, Corporate Headquarters: Greenwood Village, CO; Great-West Life & Annuity Insurance Company of New York, Home Office: NY, NY, and their subsidiaries and affiliates. GWL&A is not licensed in New York, but eligible members residing in New York may apply for coverage under the aforementioned group policy. The trademarks, logos, service marks, and design elements used are owned by Great-West Life & Annuity Insurance Company. ©2020 Great-West Life & Annuity Insurance Company. All Rights Reserved. For website issues, contact the Webmaster at ADA_WebMaster@greatwest.com

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