WILL vs Life Insurance Policy

[Ronatola]

My questions are,
1. Are my Life Insurance Policy and my WILL two separate legal entities?
2. Does one override the other?
3. If I want to leave $10k to 10 different people, where should I detail this? In my WILL or Life Insurance Policy?
a. If I detail it in my WILL and my estate does not have the funds, will the $ come out of my Life Insurance funds, even if it is not detailed in the Policy?

 

[moburkes]

My questions are,
1. Are my Life Insurance Policy and my WILL two separate legal entities?
2. Does one override the other?
3. If I want to leave $10k to 10 different people, where should I detail this? In my WILL or Life Insurance Policy?
a. If I detail it in my WILL and my estate does not have the funds, will the $ come out of my Life Insurance funds, even if it is not detailed in the Policy?

Your life insurance policy is completely separate from your will, and it passes outside of your estate. If your estate doesn't have the funds, then it has no money to distribute funds.

 

[Ronatola]

Thanks for the reply Mo.
So would the $ have to be liquid for it to be disbursed as detailed in my Will?
IE. bank accounts, pension funds
And if there was not enough liquid $, would the sale of my house by my executor contribute to those funds?

 

[moburkes]

So would the $ have to be liquid for it to be disbursed as detailed in my Will.
IE. bank accounts, pension funds

Not necessarily. For example, you might own a house with a lot of equity. And, you might have an estate with minimal debts. You could say that you'd like your house to be sold, and the profit to be split between whomever.

 

[Ronatola]

Here's another scenario for you.
If my Spouse and I die together, we would like to leave the couple who will be guardians of our 2 children $100,000 as a 'thanks for raising our kids'. The couple will also have control over the TRUSTS. They will also be the executors of our WILLs.

QUESTIONS.
1. should i leave them the $100k in my will or life insurance? Whixh choice is more effective?
2. if there's not enough $ in my estate, can they sell the house to get the $?
2. Should I detail in my Will what to do with my material possessions, and if I don't, can my exectors liquidate everthing at their discretion? Will the proceeds over and above my beneficiary payouts go into my children's trust (I indicated in my Will that the kids get everyhing 50/50, other than the beneficiary payouts)

 

[colourfastt]

Here's another scenario for you.
If my Spouse and I die together, we would like to leave the couple who will be guardians of our 2 children $100,000 as a 'thanks for raising our kids'. The couple will also have control over the TRUSTS. They will also be the executors of our WILLs.

QUESTIONS.
1. should i leave them the $100k in my will or life insurance? Whixh choice is more effective?
2. if there's not enough $ in my estate, can they sell the house to get the $?
2. Should I detail in my Will what to do with my material possessions, and if I don't, can my exectors liquidate everthing at their discretion? Will the proceeds over and above my beneficiary payouts go into my children's trust (I indicated in my Will that the kids get everyhing 50/50, other than the beneficiary payouts)

At this point, you really need to working with an attorney (or if you're in Louisiana, a notary) who specialises in estate planning. The attorney (notary) can help you structure your estate to accomplish exactly what you desire.