Estate Planning

At some point in time, everyone thinks about what will happen when we they are “gone”. Estate planning is the concept of looking at that issue in a rational and caring way. Passing assets to family, loved ones, friends, institutions, and charities while minimizing taxes and costs is the goal of a well considered plan. It is also the one way of allowing others to utilize the fruits of one’s labors which most have worked a lifetime to accomplish. Simply, a well designed estate plan provides for all the contingencies if one lives to long or dies to soon and how their estate will be distributed.

Estate Planning:  Things To Consider

Everybody needs a will.

A will tells the world exactly where you want your assets distributed when you die. It’s also the best place to name guardians for your children. Dying without a will – also known as dying “intestate” – can be costly to your heirs and leaves you no say over who gets your assets. Even if you have a trust, you still need a will to take care of any holdings outside of that trust when you die.

An estate plan has several elements.

They include: a will; assignment of power of attorney; and a living will or healthcare proxy (medical power of attorney). For some people, a trust may also make sense. Whom do you want to inherit your assets? Whom do you want handling your financial affairs if you’re ever incapacitated? Whom do you want making medical decisions for you if you become unable to make them for yourself? When putting together a plan, you must be mindful of both federal and state laws governing estates.

Taking inventory of your assets and liabilities is a good place to start.

Make out a personal financial statement. List your assets to include your investments, retirement savings, life insurance policies, receivables, and real estate and business interests. Your liabilities include your mortgages, loans, charge cards, taxes due, and other debts.

Trusts aren’t just for the wealthy.

Trusts are legal mechanisms that let you put conditions on how and when your assets will be distributed upon your death. They also allow you to reduce your estate and gift taxes and to distribute assets to your heirs without the cost, delay, and publicity of probate court, which administers wills. Some also offer greater protection of your assets from creditors and lawsuits.

Discussing your estate plans with your heirs may prevent disputes or confusion.

Inheritance can be a loaded issue. By being clear about your intentions, you help dispel potential conflicts after you’re gone. An estate planning attorney can help. An experienced estate planning attorney should:

  • Discuss with you the state of your financial affairs
  • Discuss with your estate planning goals
  • Discuss with you the potential needs of your loved ones in your absence
  • Discuss with you final healthcare wishes
  • Discuss the options available to you and will work closely with you toward solutions that meet your objectives
  • Examine and explain the steps you can take now in order to save your estate and your loved ones taxes and other expenses
  • The attorney may also anticipate and avoid negative tax implications by consulting expert accounting and tax advisors in some instances
  • Prepare and execute all necessary documents such as wills, living trusts, testamentary trusts, powers of attorney, and business agreements
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