"You don’t need to be a wealthy individual to leave a legacy."

Written By

Bob Genisot

August 9th 2023

Many people want to leave more than a bank account, family cottage, or giant box of collector plates in their estate planning. They want to leave a legacy. Leaving a legacy means something remains after you’re gone that will be valued and treasured by those who survive. It requires planning and intentional thought to ensure that your legacy can help make life better for those who succeed you.

But with the list of financial demands such as saving for retirement, paying the bills, maintaining our property, helping our children, caring for our aging parents, and paying off debt, there’s hardly room left over for “leaving a legacy”.

That’s why many people turn to life insurance to fund legacy giving.

Life insurance can be part of your legacy, as it has been for millions of people over many generations. The death benefit from your life insurance policy has the potential to carry on your memory, significantly impact your beneficiaries, and leave a lasting legacy.

Here are several ways you can use life insurance to leave your mark:

Leave an inheritance for your family This is the most obvious way to leave your legacy. Because what better way to honor your children, grandchildren, or extended family than by protecting them financially and giving them the financial resources to help them achieve their goals, like starting a business or going to college? Your loved ones can also use this money to purchase policies for themselves, thus establishing a pattern of generational wealth.
Give a charitable donation You don’t have to be a tech titan or retail giant to leave money to charity. Use the proceeds from your insurance policy to donate to a cause you deeply care about, such a church, animal shelter, or civic organization. By designating the charity as a beneficiary, you can continue to support your favorite cause even when you are no longer around.
Get a local thing named after you Okay, here’s where it gets fun: you can use the death benefit from your life insurance policy to get your local municipality to create a new park, playground, pavilion, ball field, even a statue(!) in your honor. Public funding is typically low, or non-existent for such projects. Your local parks and playgrounds may be in disrepair, requiring the injection of new funds. You can even work with your city or town to establish the plans for the facility or structure before you pass away. This funding can provide something beneficial for the community that will be used and appreciated for decades.
Donate to a school or building project Show support for your alma mater and donate your life insurance proceeds to be used for projects like a new science lab, music equipment upgrades, or an outdoor learning space. Students will benefit from your gift, and the school may even honor your donation with a plaque or room name at the facility. Similarly, funds can be used for community projects such as a new wing at the local library, or fire department garage.
Establish a scholarship You can make a tremendous difference in the lives of current and prospective students by using life insurance to establish a scholarship at a college or university. And, a large enough monetary gift can be endowed, thus providing students a scholarship year after year. These scholarships benefit worthy students who show promise but cannot otherwise afford the full cost of tuition.

This is only a small list of legacy ideas. You could use your life insurance proceeds to donate seed money to start a new nonprofit, or for funding the purchase and legal fees associated with establishing a conservation district, or pay for new instruments for the community band. This list is really only limited by your imagination and the funding available. Some of the nuances and details of these uses for life insurance can get a bit complex. You’d be well-served to discuss it with your financial planner and your tax advisor.

The bottom line is: you don’t need to be a wealthy individual to leave a legacy. As with any life insurance purchase, you have the most buying power when you are young and healthy, but people of any age and health condition can still use life insurance to leave a legacy that will make a difference in the lives of their family and community. But with the list of financial demands such as saving for retirement, paying the bills, maintaining our property, helping our children, caring for our aging parents, and paying off debt, there’s hardly room left over for “leaving a legacy”.