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dwalsh48 asks,

I have a salesman suggesting that I puchase Last to Die insurance for estate planning purposes. My estate will be somewhere in the 5 Mill. range. His logic is to use the insuranse to pay the taxes. Would I be better off investing the premiums in stocks.

That's what I found in my case. If I lived past age 84, using life insurance to avoid estate taxes actually DECREASED what was left to my heirs. The longer you live, the better off you are just continuing to let your portfolio grow and then just pay the estate taxes out of the much larger portfolio balance.

Of course, the younger you die, and the less you pay in premiums, the better life insurance looks.

Also, if Congress passes reductions in the estate tax, that may also lessen or eliminate the need to use life insurance as part of a tax avoidance scheme.


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