Estate planning is a topic that most people would rather not think about. After all, it involves two, less than desirable, topics – death and taxes. Yet, estate planning is actually one of the most important and fulfilling steps a person can take on behalf of his or her family. After working hard to earn your wealth, do you want your loved ones to receive it or the Government? We can’t, always avoid paying estate taxes, but we can make sure as much as possible goes to our loved ones and as little as possible goes to Uncle Sam.
Estate Planning, in its simplest form, means planning for the disposition or distribution of your assets upon your death. A good estate plan has three goals:
- To make sure your wealth reaches the individuals or organizations you select, and in the manner that you choose.
- To minimize the effect of federal or state taxes on your estate.
- To allow you to select who will handle various functions on your behalf.
Estate planning, in a broader sense, however, is an ongoing process. For a young, single person, an estate plan may consist of simply a Will. A couple just starting out might have Wills and own a modest home and some savings. When children arrive, whom to name as the children’s guardian and how to provide for them and your spouse in the event of unexpected death or incapacity become estate planning concerns. And, once an individual starts to realize some of his or her financial goals, asset preservation and how to avoid estate taxes become vital factors in an estate plan.
If you are like most people, you will work an entire lifetime to accumulate assets: a home, cars, savings, property, retirement assets, etc. The small amount of time and money required to create an estate plan, will ensure that your assets are passed on to the people you wish with the best possible tax consequences. The only way to ensure that your wishes are carried out is to plan ahead. Our advisors are well trained and educated in the areas of estate planning. We can help you design a financial plan that accomplishes all of your goals while you are living, as well as, after you’ve gone. We also work with other professionals, such as estate planning attorneys and CPAs, to make certain all of the legal documents necessary to complete your estate plan are in order.
A Will is the cornerstone of estate planning, but in most cases that is only the beginning. Included among the many additional planning strategies and tools used for estate planning are: “Will substitutes” such as: “living” trusts, QTIP trusts, life insurance trusts, “Crummey” trusts, charitable trusts, gifts, joint ownership, community property, beneficiary designations, family limited partnerships and more. Given the extremely high tax rates, and with all of these complex tools at your discretion, it doesn’t take long to discover how valuable professional advice and counsel can be in the area of estate planning.