Attorneys over age 55 with a good health profile have an option that can (1) provide an increase in structured attorney fee payments (2) provide a superior post mortem option for their families.
Those attorneys who are considering lifetime payments and want to have a guarantee period included to protect their families in the event of premature death should consider this option.
Instead of a lifetime annuity with a 20 year guarantee period, opt for a life only annuity (i.e stops at your death) and buy a 20 year level term policy.
HOW AN ATTORNEY BENEFITS FROM "STRUCTURED ATTORNEY FEES ON STEROIDS"
- Life only payments are substantially higher in the 55+ age category. On a recent case involving a 62 year old attorney, the spread between 20 years certain and life only for a $430,000 attorney fee structure was almost $6,000 annually.
- The cost of a $500,000 20 year level term policy on a 62 year old was approximaely $3,000 annually.
- By following this strategy the attorney receives approximately $3,000 more annually during his lifetime.
- If he dies prematurely with the 20 years certain and life annuity his family receives taxable periodic payments with a total taxable payout that diminishes the longer he lives.
- With the life only annuity paired with a 20 year level term policy the family receives a lump sum of $500,000 AT ANY POINT along the 20 year time continuum.
- Life insurance proceeds are generally income tax free. Get the picture?
- If periodic paymens would benefit the survivors they can elect (when the life insurance claim is settled) a periodic payment death benefit distribution option from the life insurer.
Because the strategy requires the life insurance be underwritten, planning must be done in advance. We suggest preunderwiting the life insurance. Once underwriting has been completed medicals may be good for a period of time so it is possible that the strategy can be replicated without the attorney having to be underwritten again during that period.
One of my competitors continues to proudly proclaim on its website "there is no interest in selling the plaintiff (or plaintiff attorney) any other type of financial product, before , during, or af the case is settled".
Plaintiff attorneys who wish to employ the "structured attorney fees on steroids" strategy may limit their opportunities to enhance their financial security by engaging representatives of such company who hold true to that company's proclamation.
Please contact John Darer, CLU ChFC CSSC RSP at 203-561-6560 for further information. We will proudly use another financial product or service alone, or in conjunction with a structured annuity, as part of a strategy to help achieve the objectives of our clients.