Estate planning is crucial to make sure your assets are taken care of the way you wish. While many people think estate planning is unnecessary or only for minimizing taxes, having a strategic plan set up in the case of an unforeseen event is beneficial. An estate plan includes who is in charge of your affairs if you are unable to do so, setting up specific needs for different members of your family, and what trusts you want created for your young beneficiaries. Continue reading for tips on putting an estate plan in place!
Write out your wishes
Document your specific wishes on what you want to happen to your asset and possessions. Without proper communication and understanding of your wishes, those decisions can be left up to the state in probate court. Be sure to include who you want as your healthcare proxy, who you want as your financial power of attorney, your living will, and your last will and testament.
Create a Guardianship for your Dependants
Decide who you want to take care of your dependents if you are no longer able to. If you do not appoint someone, a judge will for you. Make sure you gain the consent of the guardian you want to choose. You do not have to pick the same person as your healthcare or financial proxy. Creating a guardianship plan will be in the best interest of your dependents.
Plan for Estate Taxes
Your estate may be subject to federal estate taxes that are typically due within nine months after death. The estate taxes are due in cash so if most of your estate is not in cash, your beneficiaries may have to sell or liquidate assets. Talking with an advisor can allow you to put together a plan on how to prepare your estate to be taxed.
Keep Your Beneficiaries Updated
If you have accounts with named beneficiaries, the money in those accounts will go directly to those individuals no matter what the estate plan has listed. Those accounts include 401(k)s, IRAs, and insurance policies. Make sure these beneficiaries align so there are not any conflicts.
Include your Digital Assets
Many people forget about documents and account information they have saved on computers. It is extremely difficult for family members to gain access to these passwords to different accounts if they were not disclosed prior. You have the ability to name someone in your estate plan as a fiduciary for all of your digital information.
Work with an Advisor
An advisor can help you navigate the process and make sure you have checked every box when developing an estate plan. They will assist in helping you think through all the different options. Having an advisor also allows you to communicate clearly what your wishes are to an unbiased party.
Developing an estate plan is extremely helpful for your loved ones to have your wishes met the way you would like. Here at Plotkin Financial Advisors, we are ready to help you with estate planning. To learn more about our Signature Services, please feel free to reach out to us.