As you approach retirement, one of the most important financial decisions you may face is what to do with your life insurance policy. For many older adults, this policy represents more than just a death benefit. It’s a legacy tool, a safety net, and sometimes a crucial source of liquidity for heirs. One option that financial planners often recommend is placing life insurance in a trust. But there’s a question that catches many off guard: Does it matter when you make this move? In fact, for some, doing it before age 70 could be a decisive factor in how effective that strategy will be.
This timing isn’t just about paperwork. It can influence taxes, creditor protection, Medicaid eligibility, and the amount your loved ones ultimately receive. Let’s unpack what it means to put life insurance in a trust, why age 70 is a commonly discussed threshold, and the pros and cons that might affect your personal decision.
